FedEx Relies on Express Revamp to Meet $1.7 Billion Goal

FedEx Corp. (FDX)’s plan to increase profit $1.7 billion in three years relies on streamlining its Express unit, where it plans to cut jobs and replace fuel- guzzling planes, for more than 90 percent of the gains.

Express, the company’s largest division, will generate $1.55 billion of the target, executives said in a meeting with investors and creditors in Memphis, Tennessee. About $300 million will come from modernizing the air fleet and another $350 million from changes in the domestic business.

The overhaul reflects FedEx’s view that the move of some customers to ground, freight and even ocean shipping is permanent and not a temporary change linked to a slowing economy. That transition also threatens to affect United Parcel Service Inc. (UPS) and Deutsche Post AG (DPW)’s DHL Worldwide Express.

Read Full Article from Businessweek

- Posted: 2012-10-10 13:30:16

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