FedEx cuts capacity in sluggish US market

While move will reduce costs it is also part of plan to retire old freighters in 2013


24 jets domestic business economy FedEx retire planes US market


FedEx has cut capacity by 24 jets in the US domestic market. Reason: low volumes that are a result of the sluggish pace of the economy. The recent cut was in addition to five jets that were taken out of service in the last quarter. FedEx has planned to retire 21 more planes in fiscal year2013 from its fleet of 688 aircraft.

The move to cut capacity will reduce costs in the US. In fact, FedEx daily domestic package volume business has dropped by four per cent in the fiscal third quarter while operating margins in the express unit have failed to recover to pre-recession levels although revenue in the last fiscal year reached the highest in at least a decade.