UPS to Retire 27 MD-11s, Outsource Capacity with Boeing 767 Replacements
UPS will retire its 27 MD-11 freighters and replace them with Boeing 767-300s on order, outsourcing interim capacity to Cargojet and two other carriers through at least Q3. CFO Brian Dykes expects third-party airlift spending to concentrate in H1, with five new 767s arriving by summer to reduce outsourcing.
1. MD-11 Fleet Retirement and 767 Replacement
UPS announced it will retire its entire 27-strong MD-11 freighter fleet rather than return the aircraft to service after FAA inspections. These aircraft will be replaced by Boeing 767-300s already on order, supporting long-term capacity and fuel efficiency goals.
2. Interim Outsourcing with Cargojet and Partners
To bridge the gap until its new 767-300s arrive, UPS has engaged Cargojet and two other carriers on quarterly renewable contracts. Cargojet has operated multiple 767-300 and 757-200 flights between Louisville and Canadian hubs, with commitments expected to extend into Q3 and potentially peak Q4 season.
3. Impact on Costs and Capital Spending
CFO Brian Dykes said most third-party airlift spending will occur in the first half of 2026, easing as five new 767s arrive by summer. This transition aims to control outsourcing costs, optimize margins and align capital expenditures with fleet modernization plans.