UPS 2006 Annual Report Download - page 77

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UNITED PARCEL SERVICE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
NOTE 4. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment as of December 31 consists of the following (in millions):
2006 2005
Vehicles ....................................................... $ 4,970 $ 4,286
Aircraft (including aircraft under capitalized leases) ..................... 13,162 12,289
Land .......................................................... 1,026 968
Buildings....................................................... 2,667 2,404
Leasehold improvements .......................................... 2,496 2,469
Plant equipment ................................................. 5,230 4,975
Technology equipment ............................................ 1,673 1,646
Equipment under operating leases ................................... 142 87
Construction-in-progress .......................................... 715 433
32,081 29,557
Less: Accumulated depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . (15,302) (14,268)
$ 16,779 $ 15,289
NOTE 5. EMPLOYEE BENEFIT PLANS
We sponsor various retirement and pension plans, including defined benefit and defined contribution plans
which cover our employees worldwide. In the U.S. we maintain the following defined benefit pension plans: UPS
Retirement Plan, UPS Pension Plan, and several non-qualified plans including the UPS Excess Coordinating
Benefit Plan. Effective January 1, 2006, the qualified defined benefit plans covering Overnite and Motor Cargo
employees were merged with the UPS Retirement Plan and UPS Pension Plan.
We also sponsor various defined benefit plans covering certain of our International employees. The majority
of our International obligations are for defined benefit plans in Canada and the United Kingdom (including the
Lynx acquisition in 2005). In addition, many of our International employees are covered by government-
sponsored retirement and pension plans. We are not directly responsible for providing benefits to participants of
government-sponsored plans.
The UPS Retirement Plan is noncontributory and includes substantially all eligible employees of
participating domestic subsidiaries who are not members of a collective bargaining unit. This plan generally
provides for retirement benefits based on average compensation levels earned by employees prior to retirement.
Benefits payable under this plan are subject to maximum compensation limits and the annual benefit limits for a
tax qualified defined benefit plan as prescribed by the Internal Revenue Service.
The UPS Excess Coordinating Benefit Plan is a non-qualified plan that provides benefits to participants in
the UPS Retirement Plan for amounts that exceed the benefit limits described above.
The UPS Pension Plan is noncontributory and includes certain eligible employees of participating domestic
subsidiaries and members of collective bargaining units that elect to participate in the plan. This plan provides for
retirement benefits based on service credits earned by employees prior to retirement.
We also sponsor postretirement medical plans in the U.S. that provide health care benefits to our retirees
who meet certain eligibility requirements and who are not otherwise covered by multi-employer plans. Generally,
this includes employees with at least 10 years of service who have reached age 55 and employees who are
eligible for postretirement medical benefits from a Company-sponsored plan pursuant to collective bargaining
F-17