FedEx and UPS are slowing down.. In general this is really bad news for all of us as these guys are best indicators of global economy.
If I take optimistic approach.. It could be possible that more and more people are buying local (going green and organic) or using e-signature kind of services.. ahhhh.. I totally forgot the main culprit.. blame it on Apple.. Apple delayed iPhone5 release. that is causing entire global economy especially this high end shipping type of work.. more and more I think about it.. I get certain that it is iPhone5's delayed launch which is causing all the global economy meltdown. FedEx and UPS should sue Apple ;-) unfortunately, Apple has entangled FedEx and UPS as well as their one of the bigest customer.
Jokes apart, I think we should brace ourselves for slowdown in coming months/years. Global economy is still in bad shape.. with slowdown in China and little bit in India... very few sweet spots are left. Europe is in bad shape and doesn't look like it is going to come out anytime soon.. US economy is still limping at the best.. We need something to drive growth.. in my view there has to be really strong spending on infrastructure. That is the only thing which can revive economy in both short term and long term if right kind of infrastructure projects are started.
After these recent blackouts in India.. India should be investing heavily into infrastructure.. Power, Road, Rail, Internet.. They have to do it and have to do it big.. I was hoping for massive investment from US in internet side.. but doesn't look like anything is going to happen any time soon.
Let us hope for best and do our part by spending more and more to avoid this impending slowdown!!
Buyouts to pare FedEx staff
Forecast for current quarter fell well below expectations
By Samantha Bomkamp
Associated Press
NEW YORK — FedEx will soon begin offering buyouts to U.S. employees in an effort to cut costs in the face of a weakening global economy. The world’s second-largest package delivery company hinted at cutbacks earlier this summer when it said that slowing economic growth would crimp its earnings well into next year. It has already removed some aircraft from its fleet of more than 600 to account for a loss of demand. While FedEx hasn’t yet decided how many positions will be eliminated, it is likely to focus on slow-growth areas like its Express and Services units.
Express is where FedEx got its start in 1971, and it’s still the company’s biggest segment by far. The speedy shipping division, which moves 3.5 million packages on an average day, has been hit hard as people shift to slower delivery methods to conserve cash. The unit is also being dragged down slowing Asian growth and a reduction in demand for Asian goods from the U.S. and Europe. The unit reported revenue of $26.5 billion in the latest fiscal year and has more than 146,000 employees worldwide — 102,000 of those in the U.S.
Services is FedEx’s behind- the-scenes logistics division, but it also includes FedEx Office, formerly Kinko’s. It was formed in 2000 and with annual revenue of $1.7 billion in 2012, is one of FedEx’s smallest units. It has 13,000 employees, all of whom are U.S. based.
FedEx said those that are close to retirement are also eligible for buyouts.
When it reported fourthquarter earnings in June, FedEx vowed significant cost cuts to offset any drop in shipments. Its forecast for the first-quarter, which ends this month, fell well below Wall Street expectations.
And second-quarter results released in late July by larger rival United Parcel Service suggested that the global economic slowdown may be even worse than FedEx anticipated.
UPS lowered its forecast for all of 2012 and said its third-quarter earnings will fall below last year’s results, with many customers fearing what’s in store for the second half of the year. Their skittishness was also felt in the second quarter, where UPS missed analysts’ expectations for both earnings and revenue.
Shares of FedEx fell 3 cents to close at $87.77 Monday. UPS lost 15 cents to hit $76.15.
If I take optimistic approach.. It could be possible that more and more people are buying local (going green and organic) or using e-signature kind of services.. ahhhh.. I totally forgot the main culprit.. blame it on Apple.. Apple delayed iPhone5 release. that is causing entire global economy especially this high end shipping type of work.. more and more I think about it.. I get certain that it is iPhone5's delayed launch which is causing all the global economy meltdown. FedEx and UPS should sue Apple ;-) unfortunately, Apple has entangled FedEx and UPS as well as their one of the bigest customer.
Jokes apart, I think we should brace ourselves for slowdown in coming months/years. Global economy is still in bad shape.. with slowdown in China and little bit in India... very few sweet spots are left. Europe is in bad shape and doesn't look like it is going to come out anytime soon.. US economy is still limping at the best.. We need something to drive growth.. in my view there has to be really strong spending on infrastructure. That is the only thing which can revive economy in both short term and long term if right kind of infrastructure projects are started.
After these recent blackouts in India.. India should be investing heavily into infrastructure.. Power, Road, Rail, Internet.. They have to do it and have to do it big.. I was hoping for massive investment from US in internet side.. but doesn't look like anything is going to happen any time soon.
Let us hope for best and do our part by spending more and more to avoid this impending slowdown!!
Buyouts to pare FedEx staff
Forecast for current quarter fell well below expectations
By Samantha Bomkamp
Associated Press
NEW YORK — FedEx will soon begin offering buyouts to U.S. employees in an effort to cut costs in the face of a weakening global economy. The world’s second-largest package delivery company hinted at cutbacks earlier this summer when it said that slowing economic growth would crimp its earnings well into next year. It has already removed some aircraft from its fleet of more than 600 to account for a loss of demand. While FedEx hasn’t yet decided how many positions will be eliminated, it is likely to focus on slow-growth areas like its Express and Services units.
Express is where FedEx got its start in 1971, and it’s still the company’s biggest segment by far. The speedy shipping division, which moves 3.5 million packages on an average day, has been hit hard as people shift to slower delivery methods to conserve cash. The unit is also being dragged down slowing Asian growth and a reduction in demand for Asian goods from the U.S. and Europe. The unit reported revenue of $26.5 billion in the latest fiscal year and has more than 146,000 employees worldwide — 102,000 of those in the U.S.
Services is FedEx’s behind- the-scenes logistics division, but it also includes FedEx Office, formerly Kinko’s. It was formed in 2000 and with annual revenue of $1.7 billion in 2012, is one of FedEx’s smallest units. It has 13,000 employees, all of whom are U.S. based.
FedEx said those that are close to retirement are also eligible for buyouts.
When it reported fourthquarter earnings in June, FedEx vowed significant cost cuts to offset any drop in shipments. Its forecast for the first-quarter, which ends this month, fell well below Wall Street expectations.
And second-quarter results released in late July by larger rival United Parcel Service suggested that the global economic slowdown may be even worse than FedEx anticipated.
UPS lowered its forecast for all of 2012 and said its third-quarter earnings will fall below last year’s results, with many customers fearing what’s in store for the second half of the year. Their skittishness was also felt in the second quarter, where UPS missed analysts’ expectations for both earnings and revenue.
Shares of FedEx fell 3 cents to close at $87.77 Monday. UPS lost 15 cents to hit $76.15.
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