From Block 1 Rep:
Part II
Inability Ability to Pay?
No one wants to kill the goose that lays the golden eggs, right? But assertions that there aren't additional funds available for retirement become all the more interesting when this TA is viewed from other perspectives.
Did you know that the APU Fuel Sense program alone was projected to save over $30 million per year when instituted some 8+ years ago, and that just one year of that program covers the approximate cost of a 3% pay raise today for everyone on the seniority list?
Did you know that the entire value of the gains in this TA amount to only 1/2 of one penny from each dollar of FedEx's total revenues from the amendable date through the end of this TA? (1)
Did you know that the entire value of the gains in this TA amount to less than 8/10ths of one penny from each dollar of revenue for FedEx Express from the amendable date through the end of this TA? (2)
Did you know that the entire value of the gains in this TA amount to less than 15 cents per each express package from the amendable date through the TA, and that the composite yield per package exceeds $20? (3)
Did you know that the entire value of the gains in this TA amount to less than 1% of FedEx Express's operating expenses from the amendable date through the end of this TA? (4)
Most importantly...
Did you know that FedEx Express has raised their shipping rates during 6 of the last 7 years, including a 4.9% increase just this week (See FedEx website links below)? This is important because the ability to raise top line revenues protects the bottom line from increased costs; be that aircraft, ground vehicles, maintenance, fuel, or...labor.
FedEx 2010 Rate Increase - 5.9%
FedEx 2012 Rate Increase - 5.9%
FedEx 2013 Rate Increase - 5.9%
FedEx 2014 Rate Increase - 3.9%
FedEx 2015 Rate Increase - 4.9%
FedEx 2016 Rate Increase - 4.9%
FedEx and UPS Raise Fuel Surcharges - "Because they can"
"While parcel rates are up to their highest levels ever in 2015 as evidenced by parcel giants UPS and FedEx recently rolling out GRIs (general rate increases) that took effect earlier this year along with the changes to its dimensional pricing rates, fuel surcharges are also on the rise for the companies (FedEx and UPS). These changes come at a time when oil and fuel prices continue steady declines."
Increased fuel surcharges take effect for UPS and FedEx - Logistics Management
"Under the revised rates, if fuel prices remain at their current levels, FedEx Ground’s fuel surcharge rates will increase by 1.5% and those of FedEx Express will increase by 1%. The difference in fuel surcharge becomes wider at lower prices. The higher rates and broader price ranges will allow FedEx to capture higher fuel surcharge revenue if fuel prices continue to decline."
Strong Increase in Pricing Expected for FedEx
Fraternally,
DR
Block 1 Rep
Council 7 Chairman
(1) I tried to be deliberately conservative all calculations, using lesser of FY 2013 through 2015 data from FedEx 2015 Annual Report http://investors.fedex.com/…/a…/FedE...ual_Report.pdf $1.7b TA/($44b x 8.6yrs)
(2) I tried to be deliberately conservative in all calculations, using lesser of FY 2013 through 2015 data from FedEx 2015 Annual Report http://investors.fedex.com/…/a…/FedE...ual_Report.pdf $1.7b TA/($27b x 8.6yrs)
(3) I tried to be deliberately conservative in all calculations, using lesser of FY 2013 through 2015 "Package Statistics" data from FedEx 2015 Annual Report http://investors.fedex.com/…/a…/FedE...ual_Report.pdf $1.7b TA/(3,900,000 average daily volume x 365 days x 8.6 years)
(4) I tried to be deliberately conservative in all calculations, using lesser of FY 2013 through 2015 data from FedEx 2015 Annual Report http://investors.fedex.com/…/a…/FedE...ual_Report.pdf $1.7b TA /(25b annual ops expenses x 8.6 years)