FedEx to ground more planes as revenues decline and costs rise

FedEx, the global logistics giant, is set to ground additional aircraft following a decline in revenues and operating income during its fiscal fourth quarter. The company attributed the downturn to weakened demand and rising costs. In response, FedEx has already retired 18 aircraft, with plans to remove an additional 29 from scheduled flying in the upcoming fiscal year. Flight hours were down by 12 percent compared to the previous year.

This strategic move aligns with FedEx’s aim to streamline its fleet as supply-demand dynamics improve. The decline in revenues for the express division, down 13 percent year on year, was largely driven by demand fluctuations and pricing pressure. FedEx’s cost-saving initiative, which includes fleet reduction, workforce downsizing, and facility closures, aims to achieve annual cost reductions of 4 billion dollars by June 2024. Despite the challenges, FedEx remains committed to optimising capacity and adapting to market conditions.

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