FedEx shares in the stock market fell 22 % in operations this Friday. This joins the company’s projections for a slowdown of at least $ 500 million, to fall short of its profit target.

FedEx said the main reason for this debacle the crisis in the chain of loading and distribution of packages throughout the world, as a consequence of the fall in the purchasing power of citizens. As purchases fall, there is no demand and distribution stops.

The parcel delivery business has foundered in recent months due to the global economic crisis, particularly in Asia and Europe. FedEx remains vigilant but hopeful that business conditions will improve. However, the situation may extend until next November.

FedEx faces drop in cargo volume

Recently, in an interview for CNBC, the CEO of FedEx, Raj Subramaniam, declared that “the slowdown in their business is a sign of the beginning of a global recession.” He noted that the company is going through a critical drop in cargo volume in all regions of the world.

Among the measures that the company has put in place is the reduction of flights, temporary stoppage of aircraft, cut hours for its staff, delay in hiring and the closure of 90 FedEx Office locations, as well as five corporate offices.

Separately, FedEx is also “cutting $ 500 million from its capital spending budget for its fiscal year, which runs through May 2023, cutting that spending to $ 6.3 billion.”

M.Pino

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Source: todasnoticias

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