Aug 8 Reuters United Parcel Service cut its fullyear revenue and profitability targets on Tuesday as the world39;s largest package deliverer faces higher labor costs and fights to win back U.S. business lost during tumultuous contract talks with the Teamsters.

UPS reached a tentative fiveyear deal for some 340,000 U.S. employees represented by the International Brotherhood of Teamsters union shortly before the July 31 expiration of their contract. In the runup to the deal, as the union threatened to strike, customers diverted more shipments than expected to rivals, UPS CEO Carol Tome said on a conference call with analysts.

Rival FedEx required that shippers ramp up volume ahead of the UPS contract expiration in order to guarantee deliveries during a potential strike.

UPS customers shifted about 1 million packages per day to other providers, resulting in about 200 million of lost sales. Data suggests the U.S. Postal Service, FedEx and regional rivals each picked up about onethird of that business, Tome said.

It39;s all hands on deck to get back the volume that was diverted as a result of the negotiations, she said, adding that the company expects to complete that effort by the end of 2023.

Atlantabased UPS also grappled with business losses in previous contract negotiations. Much of that is expected to return because customers want to take advantage of volume discounts.

Voting by employees on whether to ratify the handshake labor agreement wraps up on Aug. 22. The…