FDX needs to warn shortly. There will be an impact but not as big as an impact UPS will have this quarter. FDX pays their franchisees a specific dollar amount per package to deliver the packages. So when a storm hits, fdx will eat most of the expenses but the delivery drivers eat the package delivery expense including overtime..
With UPS, they eat all the expenses from pickup to delivery and all overtime.
FDX will take a hit and will probably warn this week but UPS will be hit harder. The weather was horrible this year..
DRM, You are right about FDX. But if that is the case, 20 percent more volume needed to be shipped during the 4 weeks of peak this year compared to the 5 weeks last year just to break out even. I don't think that happened.
Dude, Also with this weather which started last week, the Northeast area, UPS drivers will have to deal with floods and ice.
The midwest and south have to deal with snow and ice. Especially the midwest with roads being closed.
Much overtime for drivers and package handlers in the center since drivers will get back late. In addition overtime for air hubs since planes will arrive late.
Major increase in heating the facilities in this sub 0 degree weather. Remember, garage doors open and close to let trucks in and out and you still need to keep the location warm for the people sorting packages inside.
Dude, What about Amazon distributing the volume more evenly between UPS, FDX and USPS next year.? That will be an impact.
What about the hit for all the packages being delivered late? Refunds to all customers including Amazon?
Amazon is issuing a $20 gift card for late deliveries. Is UPS contributing to it?
Maybe peak days were higher but you still need to compare total volume from the quarter. FDX didn't have a great quarter (Sept - Nov).
Sorry, but I am not too confident about this quarter. In order to justify this PE, earnings would need to rise quite a bit.
It is another reason why Amazon will look into having their own delivery fleet..