FedEx’s Fred Smith Optimistic About Economic Recovery as Ecommerce Business Booms

The Path Forward

FedEx’s business-to-business traffic fell significantly in the United States as COVID-19 lockdown measures across the country took effect, Chairman and CEO Fred Smith said in a live-streamed discussion with the Washington Post today (watch the video to the right >>).

However, the Memphis logistics giant is keeping busy with “a prolific amount of flights” delivering protective gear and heavy home-delivery volume during the pandemic, he said.

Smith expects FedEx’s industrial shipments to pick back up as economies reopen.

“I would say that we saw the lowest point, we believe, in mid-April, and there is a resurgence of some industrial shipping now.”

“China is almost fully back online with enormous backlogs both to North America and to Asia.”

FedEx's international business has been in a prolonged slump since 2018 as trade tensions between the U.S. and China swelled and economic activity in Europe slowed considerably.

FedEx Project Airbridge Operation

Much of FedEx’s air cargo activity of late has focused on shipping personal protective equipment - the company has moved about 17,000 tons of personal protective equipment (PPE), Smith said, with much of that being done as part of public-private partnership Project Airbridge.

“On a daily basis we generally have about 15 or 16 flights across both the Pacific and the Atlantic,” he said.

“So, in that sector, we have flown hundreds of hundreds of flights in and out of China all during this period of time.”

Smith further remarked that the next 18 months in economic terms are hard to see, but while others have projected extremely dire scenarios.

Smith is looking at entrepreneurship and technological advances that have allowed Americans to continue living their lives even amid lockdown, like work-from-home capabilities and front-door package delivery of essential items, which FedEx and other companies like UPS and Amazon are providing.

“What has really been hurt is those things where people come closer together… I am optimistic there is enough economic activity we can build on. I am more optimistic than most.”

Smith also stated that FedEx is continuing to hire.

“Our people are out on the front lines every day. We are prolifically hiring. We are adding in FedEx Ground unit 4,000 drivers a week. If you want to come work for us, we will be glad to take you on,” Smith said.

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