Madrid. United Parcel Services (UPS) will become the main air transport provider for the United States Postal Service (USPS), after negotiations between the public company and the previous concessionaire of the service, FedEx, have failed.
As reported by FedEx in a press release this Monday, a “long and productive” relationship of more than 20 years has ended due to divergences in future operating strategies between the firm and USPS.
FedEx has indicated that, although mutually acceptable conditions for contract renewal have not been reached, the multinational will comply with the current agreement that expires in September.
“Once the contract is concluded, we will make adjustments to our network that will drive efficiency and create more flexibility. The elimination of current structural costs will be addressed to support the volume of postal services and, together with our ‘Drive’ efforts, the profitability of FedEx will improve in fiscal year 2025 and beyond,” he concluded.
According to the specialized environment FreightWaves consulted by the CNBC, the end of the tender may mean that up to 300 FedEx pilots will be out of work. In addition, USPS payments to FedEx were reduced to about $1.7 billion (€1.583 million) in fiscal year 2023 compared to $2.4 billion (€2.236 million) in the fiscal year ended. in September 2020.
For its part, UPS has indicated that it will be the new supplier of reference for USPS effective immediately and that it will handle the majority of air transportation in the United States after a “transition period.” The company has assured that the impact of the initiative will be “considerable”, although it has not provided figures.
“Together, UPS and USPS have developed innovative solutions that benefit both parties and complement our unique, reliable and efficient integrated networks,” said UPS CEO Carol B. Tomé.
Fedex Results
FedEx posted a net profit of 879 million dollars (818.8 million euros) in its third fiscal quarter, which was equivalent to an increase of 14 percent compared to the same period of the previous year.
FedEx’s turnover between December 2023 and February 2024 reached 21,738 million dollars (20,248 million euros), 1.9 percent less than in the third quarter of the previous fiscal year.
Thus, in the first nine months of its fiscal year the company obtained a profit of two thousand 857 million dollars (two thousand 661 million euros), 17.3 percent more, while income decreased by 3.9 percent, up to 65 thousand 584 million dollars (61 thousand 89 million euros).
For the fiscal year, FedEx revised its guidance and anticipated diluted earnings per share of between $17.25 and $18.25 (16.07-17 euros) before accounting adjustments for MTM’s retirement plans and after excluding costs related to investment initiatives. business optimization, compared to the previous forecast of between 17 and 18.50 dollars (15.83-17.23 euros).
Likewise, it authorized a share buyback program worth five billion dollars (four thousand 657 million euros).
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– 2024-04-09 00:43:47
