FedEx Corp. advised shippers on Thursday that they should begin shipping now with the company if they are concerned about service disruptions arising from a possible Teamsters union strike Aug. 1 of UPS Inc.
In a communique Thursday, FedEx (NYSE: FDX) said that the company’s priority is “protecting capacity and service for existing customers.” Customers considering shifting volumes to FedEx, or currently in discussions with the company to open a new account, are “encouraged to begin shipping with FedEx now,” the communique said.
FedEx has said that while it has held productive discussions with UPS (NYSE: UPS) customers, it has yet to see any tangible bump in business as a result of shipper uncertainty over the situation.
On Wednesday, UPS and the Teamsters broke off negotiations over a new master contract, with each side blaming the other for the breakdown. There are no new talks scheduled. The Teamsters have threatened to strike if a contract is not in hand by Aug.1, the day after the current contract expires.
In an email sent Thursday to the company’s global sales and pricing teams, FedEx said that pricing offers with large customers must be signed on or before July 17 or the offer will be withdrawn. The company will honor commitments to large customers who plan to onboard after July 17.
The company will bring on new small to midsize customers as it assesses network capacity. Third parties should shift business immediately as volume shipped during the week of July 17-21 will determine how much capacity will be allocated to them, FedEx said.
Separately, Mike Parra, CEO of the Americas for DHL Express, the international air express unit of DHL, said Thursday that his company hasn’t benefited from shipper concern over a strike. Parra also told FreightWaves at an Atlanta event that he doesn’t want to see a strike, and that a work stoppage would lead to a “total disruption” of the U.S. economy.
“There isn’t a single company on the planet that can handle 24 million shipments a day that UPS manages,” Parra said, a reference to UPS’ total daily volumes mentioned in some publications. A work stoppage would also “impact our employees, and that’s not a good thing,” Parra said.
“This is not the way to earn business,” Parra said about the back and forth. “You want to earn the business the right way.”
Parra was at DHL in 1997 when the Teamsters struck UPS for 15 days. “It was horrific,” he said. “We got flooded with volume, and on Day 16 all of that business went back to UPS. It impacted our loyal customers that have been there with us,” he said.
BRENDA KUCHAREK
If it disrupts the whole U.S. economy than shame on us for letting 1 company monopolize parcel freight.
Robert
I am not an educated man, but was an RPS (Roadway Package System-the predecessor of Fed Ex Ground) P & D contractor for 5 years, from 1994 to 1999, and worked the UPS strike of 1997. Even though I was raised anti union, I now see the value of the UPS Teamsters, if they don’t stand against the new CEO of UPS, she will slowly bleed the company to death. While you can outsource human relations and customer service, which I understand she has done; you can not outsource the drivers and package handlers. Robots and autonomous vehicles cannot interact with customers. To use an old time farmers’ analogy, they had to take care of the horses they farmed with, and drivers and package handlers are the backbone of UPS.
Ivan Ivanov
“Fedex advises Freightways to earn money by promoting Fedex”
Lawrence Scism
What in the world is going on with the teamsters union putting the screws to every body lately between yellow trucking now UPS And FedEx and heaven knows who else is next.
Why don’t they just let yellow trucking consolidate and get rid of those distributions warehouses they do not need from the acquisitions and move on.
Truck drivers can find plenty of other companies out here to work with they may have to take a wage cut but some thing is better than a goose egg.
Isaiah williams
Just pile more stuff on those poor FedEx guys that don’t make anything, they get slammed daily poor guys can’t even walk through the truck because they get over loaded, damage people’s packages then the poor drivers are the last hands to touch so they take the blame for everything
P.S FedEx
Give your drivers good benefits and insurance that’s terrible
William Cole
This article is hilarious. Our company took pro active action with FedEx 2 months ago. Had all the figures of our average UPS yearly dollar volume. Sent it to the local rep. He and his boss dropped by a week or so later to pet me know that this would be handled by another rep….still waiting for pricing….. LOL…. Just unreal that trying to give corporations business is this difficult. So good luck with FedEx once again….will see what kind if deal I can work out with my local and national LTL carriers, the same way we did the last time that UPS went on strike….and coordinate with our customers to make deliveries to them on one or 2 days during the week.
We are a same day shipping company. UPS has been the most consistent delivery service. Their pricing has risen each year. Their surcharges (fuel, residential delivery, extended delivery area, additional handling on cartons over 50 lbs and peak additional handling) are typically more than the actual freight cost and 50% of the time, an LTL carrier can beat their price if there are more than 3 or 4 cartons weighing over 50 lbs each. Also UPS closed their customer window at the local terminal, which was an 18 mile round trip to PHL at the end of a work day. Now a 33 mile round trip into South Philly is required. Less service, higher prices, and competing package companies that apparently don’t value our package volume. Sad to say, but this is just part of The New Normal. I have been shipping ground freight (truckloads, pallets, packages) air freight (packages and containers), and sea freight (containers) for over 40 years….seen some incredible improvements and some baffling poor decisions made by most carriers. I do wonder where the customer service and convenience went.
Anthony Primerano Teamsters local 929
UPS is definitely the Global leader in shipping and freight management,for a company that MADE 13 BILLION IN”PROFIT LAST YEAR,they are bargaining in bad faith as far as the offers made to the men and women that are the faces of their company,not the CEO,WHO’S only concern seems to be the shareholders.They continue to offer far below the worth of her employees then blame the teamsters for walking away from the table. What a scumbag move from someone that keeps saying that volume is down from an unrealistic number stemming from the pandemic.
Midwest Teamster
I only had to read the headline. Thanks for the laugh!