Companion bills in the U.S. House and U.S. Senate aim to amend the 1938 Fair Labor Standards Act, removing the overtime exemption for truckers. Predictably, it’s opposed by shippers and rail carriers, and supported by unions, trucking associations and safety groups. A spokesman for a major auto carrier explains why he supports it.
UPS posted strong Q3 financial results, falling a bit short on revenue vs. the analyst consensus but beating on earnings, as the company was lauded for successfully making network adjustments to falling volumes, unlike rival FedEx’s report about a month ago. The brown carrier also expects peak season volume to be lighter than 2021.
Days before its third quarter earnings report, UPS matched rival FedEx by announcing a general rate increase of 6.9% for 2023, an unprecedented figure for both major carriers set as a benchmark for pricing shipper contract rates. FedEx took heat last month in announcing its rate increase last month, as it reported a painful quarter.
Instacart and the attorney’s office for the city of San Diego have reached a settlement over charges it misclassified its delivery drivers as contractors, a heated and ongoing issue in California and elsewhere that challenges the economics of last-mile delivery companies using the pervasive gig model.
FedEx Ground told its base of 6,000 contractors that domestic peak season volume is expected to be lighter than previously reported, as the company battles headwinds a year after package flow fell below forecasts, causing pain and outcries from contractors who invested heavily in trucks and drivers.
Global parcel volume increased 21% in 2021 to 159 billion pieces, according to an annual Pitney Bowes shipping index that tracks activity in 13 markets, but revenue increased at a slightly lower rate of 17% as declines in per-piece yield in China acted as a check on that growth.
The situation in the parcel industry — high shipping rates, increased surcharges and shipping delays — is a convergence of many complex issues, including supply/demand imbalance, a rough economy and geopolitical woes. Let’s take a closer look at how ecommerce and government laws have disrupted supply chains.
GoBolt, a white glove last-mile delivery service focused on carbon neutrality use electric vehicles and carbon offsets through a technology partnership, has launched parcel delivery in several U.S. and Canadian cities by leveraging an acquisition, with plans to expand as demand and adoption dictate.
FedEx detailed efforts to remove more than $6 billion in costs over time as capacity outstripped demand globally, while calling for the largest-ever rate increase of 6.9%, as analysts asked hard questions about operating missteps after a quarter with revenue up 6% but operating income down 18%.
While most markers indicate more than sufficient carrier capacity to meet Q4 demand, that doesn’t mean all is smooth sailing, with chokepoints and a possible dockworker strike. This operations special report on capacity management from Multichannel Merchant taps experts and retailers on the Q4 outlook and what to expect.