Declining demand is nudging FedEx to continue its cost-cutting and rate-raising strategies as the global environment settles into a new normal amid uncertainties. For fiscal Q2 2023 ended Nov. 30, 2022, FedEx reported overall revenue down 3% year over year to $21.63 billion and operating income down 26.2% YoY at $1.17 billion. All three divisions—Express, Ground, and Freight—reported year-over-year volume declines. However, despite volume declines, the company exceeded its fiscal Q2 earnings target primarily through “higher yield and cost management actions,” according to FedEx CEO Raj Subrama ..read more

With peak season 2022 finally finished, shippers are beginning to look back at a challenging year. Declining volumes forced difficult decisions, and persistent capacity issues left shippers unable to meet high customer expectations. With old solutions quickly becoming obsolete, big-time transportation industry players like FedEx, USPS, and Amazon are eyeing new strategies to stay competitive in a difficult time for global logistics.  But that’s not all: congressional intervention has logistics professionals breathing a sigh of relief, and a lettuce crunch is sandwiching quick-service rest ..read more

In early November, delivery giant FedEx announced the suspension of its money-back guarantee for many services. “Beginning Dec. 13, 2022, through Jan. 2, 2023, the money-back guarantee will be temporarily suspended for select FedEx Express® services for U.S. domestic and U.S. export shipments,” according to an announcement on the FedEx website. The suspension comes on the heels of recent rate increases from FedEx and UPS — and is sure to frustrate shippers already burdened with lower-than-expected peak season shipping volumes.  The announcement marks the third consecutive peak season susp ..read more

Not much of a shocker when UPS followed FedEx and announced an average 6.9% general rate increase (GRI) for 2023. Per the announcement, “This helps to support ongoing expansion and capability enhancements as we strive to maintain the high service levels you expect from UPS.” So, crunching the numbers and comparing them against FedEx’s 2023 GRI, guess what? UPS virtually mirrored FedEx’s 2023 GRI, not only on the macro level but also at the service, zone, and weight levels as well. Both companies manage their businesses through revenue management initiatives while battling rising inflation, hig ..read more

On September 22, FedEx announced its 2023 General Rate Increase, the highest in FedEx history.  And, as usual, the devil is in the details.  First, let’s look at how the numbers shake out. Big Increases for Biggest Weights & Highest Zones The biggest increases in Ground / Home Delivery will be in the highest weights and the highest zones.  But FedEx did manage to squeeze in the largest increase below 25 lbs. where it would make the biggest difference; on zone 2, 1 lb. rate.  As you may be aware, this is the rate used as the peg for the Ground Minimum Package Charge.&nb ..read more

A week after FedEx issued a surprising pre-release for its fiscal Q1 2023 (period ending August 31), the company officially issued its financial details on Sept 22. Total company revenue increased 4.5% to $23.0 billion. Still, total operating income declined 15% to $1.19 billion on an as-reported basis and down 17.4% to $1.49 billion on an adjusted basis showing some signs of challenges faced by the carrier. Volumes declined in all three divisions, but FedEx Freight, the smallest division in terms of revenue, reported the strongest gains in operating income, up 67% to $651 million, despite ave ..read more

As a new illness provokes a new national emergency, there are many different perspectives on the severity of the disease. However, regardless of health and political stances, shippers are wary of the potential for added disruptions to their barely recovered supply chains. The following eight industry stories can guide shippers to fight for resiliency within their localized chain in the event of another pandemic. FedEx Updates Peak Surcharge and Fees For First Time in 2022 The first wave of the pandemic wreaked havoc on the supply chain, causing FedEx to initiate its first set of peak surcharge ..read more

While most contiguous U.S. states continue to experience intense heat and seasonal drought, a new season has begun in the supply chain. While some are shaking off their COVID-19 strategies, others are adjusting COVID-prompted changes into new business plans to address the latest global disruptions. Here are some recaps of the latest market changes to guide supply chain professionals in their quarterly business plan shifts. FedEx Unleashes Consolidation and Collaboration Plans for “Network 2.0” On June 29, FedEx revealed “Network 2.0”, a new long-term strategy focused on collaborating with FedE ..read more

As calendars flip to another month, it can be hard to believe that the first half of 2022 is already over. While many had their eyes set on fireworks and a three-day weekend this July 4th, others hustled toward end-of-quarter goals. The following seven stories will recap business moves, innovative ideas, and industry insight to guide supply chain professionals into the launch of the next quarter. FedEx Partners with FourKites to Develop Logistics Intelligence Platform On June 22, 2022, FedEx and FourKites announced a joint initiative to develop an end-to-end intelligence platform called FourKi ..read more

The U.S. parcel market underwent a shift in Q1 2022 as year-over-year average daily parcel volumes dropped for the two largest third-party parcel carriers. FedEx reported a 0.1% drop for its fiscal third quarter that ended February 28, while UPS reported a 3.0% decline year-over-year for its first quarter that ended March 31. The omicron variant, high inflation, a surge in energy prices, COVID-19 lockdowns in Asia, and geopolitical uncertainty contributed to the average daily parcel volume declines. However, neither company seemed too concerned about the parcel volume declines. The average rev ..read more