FedEx Freight, the less-than-truckload arm of FedEx Corp. and the nation’s largest LTL carrier, said Saturday it will furlough an undetermined number of drivers starting in early December.
The furloughs are scheduled to last about 90 days, during which time affected workers will continue to receive health benefits and will be allowed to file for unemployment benefits in their respective states of residence. Some eligible employees will be offered permanent transfer opportunities to other markets that have hiring needs, the unit said in a statement.
The furloughs are expected to affect a small number of drivers, and not all facilities will be targeted, said Miranda Yarbro, a FedEx Freight spokesperson. The furloughs will be voluntary, Yarbro added.
“Because of our previous experience with furlough and with the incentives we are offering, we are expecting employees to volunteer to meet the business need,” Yarbro said in an email.
The unit employs about 45,000 people. It was not immediately clear how many drivers it employs.
The action was taken in response to slowing macroeconomic conditions that have impacted LTL demand in recent weeks, the unit said. The LTL segment, which has shown very strong growth coming out of the pandemic, has seen volumes level off recently due to economic uncertainty caused by high inflation and recession concerns.
FedEx Freight has been the best performer of FedEx’s (NYSE: FDX) three transport business units. Its two larger units, FedEx Express and FedEx Ground, have been hurt by high costs and slower-than-expected demand. FedEx Freight, by contrast, has focused on profitable growth and has been willing to shed unprofitable tonnage to achieve that goal.
In its fiscal 2023 first quarter, which ended Aug. 31, FedEx Freight’s operating income increased 67%. The gains were driven by actions to improve shipment yields, as well as the positive impact of higher fuel surcharges, the parent reported.
If you are a FedEx Freight employee with a story to share, email the reporter at msolomon@freightwaves.com.
Dana
Operating REVENUES 67% increase does not compute
Ron
They are making money, just as much as they wish they were making. The LTL is not down. There are a lot independents doing LTL loads now. Their prices are much better than the bigger companies. They are on time and with less damage to the freight. FedEx are meeting the demands of their customers. My company deals with a lot of LTL loads and companies with FedEx being the worst one by far.
Peter J Miles
It’s rough on a class b driver,
Lenard Poon
I stopped using FedEx for all personal and company business when they lost two different shipped documents, one including highly sensitive documents sent to the FBI. FedEx offered NO mitigating benefit whatsoever on both goofups. Never again. Use Brown or USPS.
Michael Gastaldo
Any signs of recession /economic turmoil make me giggle like a little school boy…I feel like a kid the night before Christmas and just can’t wait to see what I get in the morning…I’m still living in the 4th house I bought from the October 2008 collapse…paid 102.000.00…and it’s worth 675.000.00…I really don’t need anymore money at this point but Im greedy like everyone else.
Dennis
These furloughs… are after already having the majority of driver sitting at home for the past few months, and the incentives are not what they were during the so called pandemic, these employees will be making much less with just unemployment. Honestly I don’t see many of them coming back with how little they will actually get from unemployment… 18 years at freight and this by far has been the worst freight tonnage I’ve ever seen. Many of us knows this is to save face with stock holders as that option along with no more pension offered by one of the largest companies around, , all smoke n mirrors… this deffinatly is not the prior fedex freight.
Mike
@Owen has FedEx Freight even been in business for 32 years??
Owen
I have worked for FedEx Freight for 32 years now. Anyone who has worked in the ltl freight business has seen this before. The freight business goes thru cycles of boom and bust. Anyone who try’s to tell you different doesn’t know what they are talking about and has never studied the business in detail. As for some of the previous comments the commentators should name the particular division of FedEx the have problems with. Don’t lump Freight in with Ground or Express each division caters to a specific type of business. I’m not without sympathy for the people who get furloughed but I would advise them to hang on and ride it out.