Originally Posted by
Noworkallplay
That was big. Looks like the next 1-3 years will see huge growth per earnings call. They (CEO Level) are calling it "The new normal".
Growth is not always a good thing which is why UPS’s CEO instituted “Better Not Bigger” model.
The devil is in the details.
FEDEX EXPRESS
PACKAGE VOLUMES: (3 Month Trend)
While there are some increases, look at the decreases:
US Deferred -4%
Total US Package -1%
International Economy -2%
International Domestic -19%
TOTAL AVERAGE DAILY PACKAGES -6%
TOTAL FREIGHT: (3 Month Trend)
Average Daily Freight Pounds:
US -9%
International Economy -4%
International Airfreight -23%
TOTAL AVERAGE DAILY FREIGHT POUNDS -3%
FedEx Express is down 6% in packages and 3% in freight pounds over the past 3-months. The 6-month trends are similar. They increased revenues on moving less by raising prices.
FedEx Ground segment saw a 25% reduction of Economy Freight. FedEx Freight segment continues to be the shining star for the corporation and is killing it.
Yes, the sky isn’t falling but the yields are down once again. That is the problem. Our growth!and dominance isn’t solving the falling yields. Why?
Amazon now shipping more packages in the USA than FedEx or UPS. Amazon is now shipping for other websites and companies — even ones that are competitors. They’ve opened up their super hub in CVG.
They have freight software programs written specifically to optimize empty space (on planes and their LTL trucks) and to sell the open space to offset their Webpage shipping costs. They also have AWS on the balance sheet to allow them to undercut everyone in logistics or their other businesses. Amazon is targeting FedEx/UPS customers specifically showing customers how Amazon can ship for less. And while FedEx/UPS have stringent pickup and delivery times, Amazon is flexing to the needs of the customer. This is a gigantic problem.
FedEx this week announced an expanded sort facility in Miami. From pictures I’ve seen it looks like the same old manual sorts with big conveyer belts requiring lots of workers. Meanwhile everything Amazon builds is state of the art.
I just don’t see how you compete against Amazon unless they’re broken up and they can’t use their very profitable AWS to undercut every other industry they get into.
Go on, bring the hate. I know many will shoot the messenger.