Despite concerns rivals are gaining ground, United Parcel Service Inc. Chairman and Chief Executive Michael Eskew said on Wednesday he was optimistic about the package deliverer's growth prospects in 2005.

　　Atlanta-based UPS (Research) has been battling in the past year to overcome a perception that it is underperforming FedEx Corp. (Research), its main competitor, in the giant U.S. ground delivery market.

　　While UPS remains the leader in the U.S. ground delivery market, its volumes in this key area grew a sluggish 1.6 percent in the fourth quarter of 2004, down from 2.5 percent growth in the same period in 2003.

　　"We had a tough December, but we're optimistic about this year," Eskew told reporters on Wednesday after a speech to an Atlanta business group. Eskew, who took over the reins of UPS three years ago amid a downturn in the U.S. economy, said he was confident it could fend off FedEx, which has been boosted by its purchase of retail printing and document management firm Kinkos.

　　"We like our position," he said. "We have a lot more stores and our stores have done great."

　　Eskew also said he expected UPS to continue acquiring other smaller companies in an effort to expand in supply chain management, freight forwarding and other key areas of its business.

　　Shares of UPS rose 42 cents to close at $76.65 on the New York Stock Exchange. FedEx was up $1 to end at $96.64 on the NYSE.