FedEx Corp. expects its air express unit will lose half of its business with the U.S. Postal Service when an existing contract expires, making more pilots expendable, FreightWaves has learned.
The Postal Service three years ago began shifting a large amount of volume from air to ground transportation to reduce red ink and become more competitive. Declining postal volumes have been a significant drag on FedEx Express’ recent performance, company officials publicly acknowledge.
Postal delivery at 29 daytime cities where FedEx flies domestically is in jeopardy of being eliminated at the end of the government’s fiscal year, Pat DiMento, FedEx’s vice president of flight operations and training, warned in a recent meeting with a group of supervisory pilots.
“If I were to bet, I think we lose 50% of our daytime flying,” he said in an unauthorized recording reviewed by FreightWaves.