Originally Posted by
Precontact
That's the gist of what the analyst are complaining about. One driver for UPS will typically stop once or twice at a location - early for the next day air packages and later on for the 2 day/ground packages while the same location may see several different FedEx drivers. The UPS model is much more integrated and efficient, but also highly unionized. UPS Teamsters are one of the largest unions the country.
Fedex uses the contractor/1099 model for Ground, UPS uses integrated system. Even with a highly unionized, in house workforce, operating margins are still higher at UPS, and it has been higher pretty consistently. Maybe this is why WS has been saying all along the split model doesn’t bring the savings Fedex mgmt says it does.