Package delivery giant FedEx is forecasting another record holiday as it expects to move more than 290 million shipments between Black Friday and Christmas Eve, an 8.8 percent increase in overall year-over-year peak seasonal volume.
The season is expected to be bolstered by three volume spikes throughout December, occurring the first three Mondays of the month and each expected to surpass 20 million in volume.
In a statement, FedEx said December 15 is projected to be the busiest day in the company’s history, with a forecasted 22.6 million shipments moving around the world.
FedEx said it has taken several measures over the years to prepare for the busy peak season, including continuous investment over the past five years in its network growth and capacity that has amounted to close to US$2.5 billion in capacity projects, mostly for its ground network.
In 2015, the U.S. company plans to invest another $1.2 billion in its land service, most of which is for capacity and automation, including more than 70 major expansion projects.
Another strategy in preparation for the peak season is the continued modernization of its global fleet of aircraft through deployment of new, more efficient freighters, including 757, 767, and 777 aircraft.
In addition, the company is adding this year more than 50,000 temporary positions across its operating companies for the peak season, including package handlers, helpers, drivers, and other support personnel.
Panalpina profitability unchanged
In other logistics news, freight forwarder Panalpina said it “kept up overall profitability” in the first nine months of 2014 despite its ongoing restructuring. The group saw adjusted gross profit and EBIT (earnings before interest and taxes) both increase by 1 percent, reaching CHF1.178 billion (US$1.23 billion) and CHF94.4 million, respectively.
“We have managed to keep up profitability in the first nine months of the year,” said group CEO Peter Ulber. “I am particularly pleased with our progress in logistics, where we have significantly reduced losses and are close to reaching break-even. We also showed continued good volume growth in air freight and very strong volume growth in ocean freight.”
EBIT loss in logistics was reduced drastically to CHF6.9 million for the period January-September (down from CHF26.8 million in the same period of 2013). Airfreight and ocean freight volumes grew 4 percent and 8 percent year-to-date, but unit profitability decreased due to margin pressure and currency effects.
“With our logistics business likely to reach break-even far earlier than anticipated, our main focus has now clearly shifted to improving our performance in ocean freight,” added Ulber. “We already produce high volumes, but we have to reengineer processes and roll out the next generation IT platform.”
