"United Parcel Service Inc. said Thursday it has signed an agreement with the Shanghai Airport Authority to build an air hub at Pudong International Airport in Shanghai.

The UPS International Air Hub will be the first built in China by a U.S. carrier, according to a news release. It is scheduled to open next year.

The Atlanta-based package shipper (NYSE: UPS) said the hub will make it easier to expand its international and Chinese networks and will provide new flexibility in the scheduling flights.

UPS, which bases its airlines division in Louisville, said it currently has 76 takeoffs and landings per week in Shanghai. The company serves more than 330 cities in China and has more than 4,500 employees in the country. Its Chinese logistics network includes more than 60 distribution centers.

The new hub will be about 1 million square feet, and rapid expansion is expected, UPS said in the release. Its sorting capacity is projected to reach 17,000 pieces per hour by 2012, and employment is expected to exceed 1,000 by 2010.

When the hub opens, UPS plans to increase its capacity into Shanghai by moving to Boeing 747-400 aircraft from the current MD-11s, according to the release."