Many postal pundits often say USPS should operate like FedEx. But if that were truly the case USPS should raise it rates as often as FedEx. Here is an excerpt of FedEx’s announcement yesterday”
MEMPHIS, Tenn., September 18, 2013, FedEx Corp. (NYSE: FDX)
2014 Rate Increases
FedEx Express will increase shipping rates by an average of 3.9% for U.S. domestic, U.S. export and U.S. import services effective January 6, 2014. The FedEx Ground and FedEx SmartPost pricing changes for 2014 will be announced later this year. FedEx Freight implemented a 4.5% general rate increase on July 1, 2013.
Details of changes that will be made to FedEx Express surcharges can be found at fedex.com/us/2014rates.
FedEx Express Segment
For the first quarter, the FedEx Express segment reported:
- Revenue of $6.61 billion, down slightly from last year’s $6.63 billion
- Operating income of $236 million, up 14% from $207 million a year ago
- Operating margin of 3.6%, up from 3.1% the previous year
Revenue decreased due to lower fuel surcharge revenue and one fewer operating day. U.S. domestic average daily package volume increased 1% while U.S. domestic revenue per package was essentially flat, as higher rate per pound and weight per package were offset by lower fuel surcharges. FedEx international export average daily volume grew 4% during the quarter, as FedEx International Economy grew 15% while FedEx International Priority slightly declined. International export revenue per package fell 4% primarily due to lower fuel surcharges, lower rates and the demand shift to lower-yielding international services.
Operating income and margin growth were constrained by the significant net negative impact of the fuel surcharge timing lag and one fewer operating day.
Despite these constraints, operating results improved due to better base U.S. business performance and lower pension expenses. The continued modernization of the company’s aircraft fleet drove maintenance costs lower, partially offset by higher related depreciation expense.