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Old 02-16-2017, 06:39 AM   #1
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Default FDX v The Future

Take aside the type of flying (cargo v major) - Where is the best place to be right now? I remember a decade ago that the likes of FDX was over and above the best paid, and most secure pilot job.

Now I was just peeking at the UAL contract and widebody pay is more? I haven't compared Retirement clauses yet, so that might be a game changer but also,

Is anyone at FDX concerned about emerging technologies that could impact the business model? I've read a Stanford Business Review (not the only) article that indicates traditional cargo is under a real threat from new entrants to the market.

Prime Air may not need as many airframes to get the same job done since they will supplement with drones, automated transport and thousands of AMAZON FLEX "Uber-like" independent operators (average joe driving his sedan or pick up) will also supply lift from the ground-based Distribution Center to provide same day/next day delivery.

In 5 years or less, we could be experiencing a round-the-clock movement of parcels that will completely satisfy at least a 2 day delivery algorithm without need for much airlift? It's part ways scary and fascinating but remember Blockbuster video?

https://flex.amazon.com/about
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Old 02-16-2017, 10:40 AM   #2
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BL: I still think FedEx is a great place to be. As far as WB pay numbers, it seems like those fluctuate with today's leader being tomorrow's trailer. One other consideration on pay rates is looking at what percentage of pilots are making widebody pay. At FedEx there are new hires getting 777, and 7-8 year guys getting WB captain pay. Is that happening at UAL?

As far as Amazon, one of the statistics I've heard is that no single customer makes up more than 3% of the revenue at FDX. I'm not sure how Amazon fits into that number, but I also know that Amazon's flex drivers probably won't be licensed or willing to carry the DG (Dangerous Goods) that we carry. My limited understanding is that a big part of the profit at FDX is DG and First Overnight, neither of which are going to be replaced by Amazon Flex drivers.
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Old 02-16-2017, 01:45 PM   #3
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I'm not worried about "drone" technology taking over for cargo aircraft. That technology, if ever...is at least three decades away. Too many problems with security/safety and FAA certification alone will take 10 years.

"Amazon Flex", much like Uber/Lyft, will likely wind up no more profitable than traditional services when regulation finally arrives, and it will. Bezo's is just the latest EGO to make the mistake of thinking he knows something about the airline industry.

Groups like UAL, et al look good right now, but you have to understand that their business plan is no where NEAR as profitable as Fedex or UPS. Pax airlines operate on average on a 2% profit margin, while purple or brown typically are several times that.

Remember, overall your work life should be fun but it has to pay the bills.

In the end, go with what fits you best. Just remember to never feed....TROLLS.
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Old 02-16-2017, 02:29 PM   #4
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Quote:
Originally Posted by DC2EWR View Post

Prime Air may not need as many airframes to get the same job done since they will supplement with drones, automated transport and thousands of AMAZON FLEX "Uber-like" independent operators (average joe driving his sedan or pick up) will also supply lift from the ground-based Distribution Center to provide same day/next day delivery.

In 5 years or less, we could be experiencing a round-the-clock movement of parcels that will completely satisfy at least a 2 day delivery algorithm without need for much airlift? It's part ways scary and fascinating but remember Blockbuster video?

https://flex.amazon.com/about

Not as many airframes ... which routes would you eliminate?

Most of our airplanes carry freight TO a given location, and they carry freight FROM that same location. What will Amazon airplanes carry on the return route?

For the routes no longer served by airplanes, what "drones, automated transport, and Amazon Flex drivers" will be used? What will be the range of these drones? Speed? Payload capacity? Security and safety issues? Best shotgun load to take them down? How well do they work in rain, sleet, and snow?

"Automated transport"? What are you talking about here?

Amazon Flex drivers. How many do you think will be driving during that Christmas Eve snowstorm? How reliable, dependable, and honest do you expect them to be?

And finally, how far do you think these alternate means of transportation -- drones, "automated transport", and Amazon Flex drivers -- will be able to move a package in 24 hours? Are any of the above in the 600 mph range?






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Old 02-16-2017, 02:33 PM   #5
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Are drones CatIII qualified?
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Old 02-16-2017, 04:35 PM   #6
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Quote:
Originally Posted by DC2EWR View Post
Take aside the type of flying (cargo v major) - Where is the best place to be right now? I remember a decade ago that the likes of FDX was over and above the best paid, and most secure pilot job.

Now I was just peeking at the UAL contract and widebody pay is more? I haven't compared Retirement clauses yet, so that might be a game changer but also,

Is anyone at FDX concerned about emerging technologies that could impact the business model? I've read a Stanford Business Review (not the only) article that indicates traditional cargo is under a real threat from new entrants to the market.

Prime Air may not need as many airframes to get the same job done since they will supplement with drones, automated transport and thousands of AMAZON FLEX "Uber-like" independent operators (average joe driving his sedan or pick up) will also supply lift from the ground-based Distribution Center to provide same day/next day delivery.

In 5 years or less, we could be experiencing a round-the-clock movement of parcels that will completely satisfy at least a 2 day delivery algorithm without need for much airlift? It's part ways scary and fascinating but remember Blockbuster video?

https://flex.amazon.com/about
I hate to bash you because I would be a liar if I said I am not worried about the future. Nobody knows what is going to happen. Every airline pilot's job is at risk from a variety of emerging technologies.

However, no company comprises more than 3% of FedEx's business. Meaning, Amazon currently does not use 3% of FedEx's system. So even if FedEx lost Amazon altogether, our business would only be down 3%.

More importantly, non-e-commerce deliveries to residences and business-to-business traffic represents the vast majority of FedEx's revenue.

Additionally, brick and mortar companies are now designing their own mini-fulfillment centers to better compete with Amazon. Amazon is not the cheapest it once was.

FedEx has started FedEx Fulfillment -- FedEx will warehouse your goods, when an order is placed, a FedEx worker will retrieve the item, wrap it in your brand's box, and ship it to your customer.

Be it naive or very smart, our found Fred Smith continuously says he isn't worried about Amazon moving their own e-commerce.

E-commerce also is very expensive. UPS found that out the hardway this year. Individual home shipments are expensive and inefficient.

UPS stock suffers biggest drop in 2 years as e-commerce surge is still causing problems - MarketWatch

Last edited by PurpleToolBox; 02-16-2017 at 04:52 PM.
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Old 02-16-2017, 05:51 PM   #7
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What I was reading about "automated transport" is just that - a driverless 18 wheeler carrying lift. It's theoretical that take away the human driver limits and build a matrix system that will overlap - essentially lift will be moving on the ground continually around the clock.

Thank for the insight(s). Just curious if that topic was on anyone's radar. Would like to hear more. Good point on "Regulation" - that typically is what slows innovation more than anything.
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Old 02-16-2017, 09:50 PM   #8
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Yes, voters are going to be totally cool with driverless semi-trucks on the road.
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Old 02-17-2017, 01:07 AM   #9
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The threat to FDX pilots is not automation, or Amazon, or Uber delivery drivers.

The threat is the impending exit of Fred. Fred, for all his faults, understands the primacy of protecting the brand. We don't know what the next bunch will protect.

My dad was at Northwest when Al Checchi took over at the ripe age of 41. The company was so far in the black that they wrote checks for 747's, and stayed in company-owned hotels all over Asia. Al led a leveraged buyout. In two years they had sold every plane and leased them back, sold all real estate, and were 2 billion dollars in debt. Employees ate 800 million in concessions (my dad lost 25% of his pay). Al took about 32 million for his efforts and left the business to run for governor of CA. Northwest was bankrupt 12 years later.

So who replaces Fred. That's what I worry about.....
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Old 02-17-2017, 02:06 AM   #10
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The biggest threat to FedEx and UPS is our current President trade policies
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