FedEx

FedEx

Type	Public (NYSE: FDX)
Founded	1971
Headquarters	Memphis, Tennessee, United States
Key people	Frederick W. Smith, Chairman, President Alan B. Graf Jr., CEO T. Michael Glenn, EVP/CFO EVP-Marketing Robert B. Carter, EVP/CIO
Industry	Courier
Products	See complete products listing.
Market cap	$24 billion USD (2008)[1]
Revenue	▲$36 billion USD (2007)
Operating income	▲$3.276 billion USD (2007)
Net income	▲$2.016 billion USD (2007)
Employees	275,000 (2006)
Subsidiaries	FedEx Office, FedEx Express, FedEx Ground, FedEx Freight, FedEx Custom Critical, FedEx Supply Chain, FedEx Trade Networks, FedEx Services
Website	www.fedex.com

FedEx Corporation (NYSE: FDX), is a logistics services company, based in the United States. Previous names were Federal Express, Federal Express Corporation, and FDX Corporation.

FedEx is a syllabic abbreviation of the company's original name, Federal Express, used until 2000.

History

The company was founded as Federal Express in 1971 by Fred Smith in Little Rock, Arkansas. Smith's grandfather was a steamboat captain and his father built a bus system that led to the southern Greyhound Bus system.^[2] The original funding for FedEx came from an investment of $4 million that he inherited from his father with an additional $80 million from venture capitalists.^[2]

first FedEx aircraft, on display at National Air and Space Museum

The company moved to Memphis, Tennessee and Memphis International Airport after lack of support from Little Rock National Airport and began operations on April 17, 1973 with 14 Dassault Falcon 20's connecting 25 U.S. cities. In 1977 cargo airline deregulation was enacted allowing the company to purchase seven Boeing 727s.^[3]

A FedEx Express delivery truck, showing the dual branding—both "FedEx" and "Federal Express"—the company used from 1994 to 2000

In 1978, the company was listed on the New York Stock Exchange under the symbol FDX. In 1983 it became the first United States company to reach revenues of $1 billion within 10 years of startup without merger or acquisition. In 1994 the company changed its official name to FedEx Corporation.

In 1979, the company became the first cargo company to computerize package routing. In 1986 tracking was introduced, allowing customers to track the delivery of their shipments. Fedex.com was launched in 1994 allowing customers to track packages online.

The company began international service to Canada in 1981, and two years later service to Asia began with the acquisition of Gelco Express International. In 1989 the company acquired Flying Tiger Line to expand its international service. In 1995 air routes from Evergreen International were acquired and service to China began. Caliber System Inc. which included RPS, Inc., Roberts Express and Viking Freight were acquired in 1998. Caribbean routes were enhanced with the acquisition of Caribbean Transportation Services in 1999. In 2001, the company contracted to transport large amounts of United States Postal Service mail. In 2007, the company acquired ANC, a UK shipping company and Flying-Cargo Hungary KFT expanding its European shipping business. In 2001, American Freightways was acquired and FedEx Freight was established. In 2003, the company acquired Kinko's and created FedEx Kinko’s Office and Print Services. Watkins Motor Lines was aquired in 2005 and added to the FedEx Freight division. ^[3]

In December 2007, the Internal Revenue Service of the United States 'tentatively decided' that FedEx Ground Division might be facing a tax liability of $319 million for 2002, due to misclassification of its operatives as independent contractors. Reversing a 1994 decision which allowed FedEx to classify its operatives that own their own vehicles, the IRS is auditing the years 2003 to 2006, with a view to assessing whether similar misclassification of operatives has taken place. FedEx denies that any irregularities in classification have taken place, but is facing legal action from operatives claiming benefits that would have accrued had they been classified as employees.^[4]

Operating units and logos

FedEx is organized into operating units, each of which has its own version of the wordmark, designed by Lindon Leader of Landor Associates, in 1994. The Fed is always purple and the Ex is in a different color for each division and grey for the overall corporation use. The original "FedEx" logo had the Ex in orange; it is now used as the FedEx Express wordmark. The FedEx wordmark is notable for containing a hidden right-pointing arrow in the negative space between the "E" and the "X".

FedEx Airbus A310-200

• FedEx Express (Orange "Ex") - The original overnight courier services, providing next day air service within the United States and time-definite international service. FedEx Express operates the largest civil aircraft fleet in the world and the largest fleet of wide bodied civil aircraft; it also carries more freight than any other airline.^[5]

• FedEx Ground (Green "Ex") - Guaranteed day-definite delivery within the United States and Canada at a cost savings as compared to time-definite FedEx Express. Uses a large fleet of trucks which are owned by the independent owner/operators and drivers are independent contractors who control individual delivery routes and territories. Formerly Roadway Package System (RPS). ^[6]
  • FedEx Home Delivery - A division of FedEx Ground, specializing in residential delivery Tuesday through Saturday and offers delivery options to provide more flexibility for residential recipients. The logo includes a drawing of a dog carrying a package known as spot.com. FedEx Home Delivery only operates in the United States. To make up the difference, FedEx Ground in Canada performs the business deliveries and residential deliveries.^[7]
  • FedEx SmartPost - Consolidates parcels from merchants such as e-commerce and catalog companies and uses the United States Postal Service for the final delivery. Formerly the independent company Parcel Direct until FedEx acquired them for $120M in 2004.^[8]

FedEx Ground delivery truck

• FedEx Freight (Red "Ex") - Less than truckload (LTL) and other freight services. FedEx is one of the largest LTL carriers in the United States, behind YRC Worldwide, and Con-way.
  • FedEx Freight East - Formerly American Freightways.
  • FedEx Freight West - Formerly Viking Freight.
  • FedEx National LTL - Formerly Watkins Motor Lines.
  • FedEx Freight Canada - Formerly Watkins Canada Express.
  • Caribbean Transport Services - Up until 2003, a part of FedEx Trade Networks. Provides airfreight forwarding services between the U.S. mainland, Puerto Rico, the Dominican Republic, and other Caribbean islands.

• FedEx Custom Critical (Blue "Ex")- Delivers urgent, valuable, or hazardous items using trucks and chartered aircraft. Freight not accepted for transport includes perishable food, alcohol, livestock, household goods, hazardous waste and money.^[9] Drivers are independent contractors. Service in Mexico uses interline carriers. Formerly Roberts Cartage or Roberts Express.
  • Passport Transport - Transports cars, especially those of high value.
  • White Glove Services - Handles high-value or sensitive freight which may require special handling, extra security, or temperature controlled transport. For example, bacteria cultures, temperature sensitive medications, and certain food items^[10] can be transported at the temperature intended by the shipper.
  • Air Expedite - Formerly known as CharterAir. Specializes in same and next day delivery of freight, including Saturday delivery. Capable of chartering exclusive-use aircraft from Cessna Caravans up to Antonov An-124s for both domestic and international shipments. Also provides airfreight options for freight normally considered too large and/or heavy to be shipped via normal Express Freight service.

• FedEx Trade Networks (Yellow "Ex")- Provides services relating to customs, insurance, and transportation advice. Formerly C.J. Tower & Sons, then Tower Group International.

• FedEx Supply Chain Services (Grey "Ex")- Provides logistics services including Critical Inventory Logistics, Transportation Management Services, Fulfillment Services, etc. Formerly Roadway Logistics System, then Caliber Logistics.

• FedEx Services (Grey "Ex")- Provides marketing and information technology (IT) services for the other FedEx divisions.

• FedEx FCIS or FedEx Customer Information Services - Offering a customer service toll-free telephone line for customer questions. It is operated by an automated operator then will prompt the user to a live agent for uses of tracking, claims, scheduling pick-ups (Express, Ground, Same Day, Custom Critical, Freight Express, and Freight LTL), compliments and complaints, locations (both staffed counter locations and drop-boxes), ordering supplies, setting up FedEx accounts, billing etc.

FedEx Kinko's

• FedEx Office (formerly FedEx Kinko's) (Blue "Ex") - The retail arm of the corporation, offers copying and digital printing, professional finishing, document creation, Internet access, computer rentals, videoconferencing, signs and graphics, notary, direct mail, Web-based printing, and FedEx shipping. Formerly an independent company, known as Kinko's until it was acquired by FedEx in 2004 and rebranded to FedEx Kinko's.^[11]
  • FedEx Office and Print Centers - Provides limited FedEx Kinko's services such as copying, printing, Internet access and FedEx shipping.
  • FedEx Ship Centers - Provides a central location for FedEx customers to deposit their packages for shipping, also offering a self service photocopy and fax machine, office products for packing and shipping, boxes and packaging services. Formerly, these locations were called FedEx World Service Centers.

Political donations

According to the Center for Responsive Politics, FedEx Corp is the 21st largest campaign contributor in the United States. They have donated over $21,124,184 since 1990, 45% of which went to Democrats and 55% to Republicans. Strong ties to the White House and members of Congress allow access to international trade and tax cut debates as well as the rules of the business practices of the United States Postal Service. In 2001, FedEx sealed a $9 billion deal with the USPS to transport all of the post office's overnight and express deliveries.^[12]

In 2005, FedEx was among 53 entities that contributed the maximum of $250,000 to sponsor the second inauguration of President George W. Bush.^{[13] [14] [15]}

Advertising

Slogans

Previous Slogans:

• "When it absolutely, positively has to be there overnight"
• "Absolutely, positively"
• "Don't panic"
• "Whatever it takes"

Current Slogans:

• "The World on Time"
• "Relax, it's FedEx"

Motorsports

• From 1997 to 2002, FedEx was the title sponsor of Champ Car World Series when it was known as CART. The series was known as the CART FedEx Championship Series, which led to the official "Champ Car" designation in reference to the fact they were the FedEx Championship.
• FedEx became the sponsor of the #11 NASCAR Sprint Cup Toyota owned by Joe Gibbs Racing in 2005. FedEx uses four (predominantly black) paint schemes to showcase its different products (Express, Freight, Ground, and Office), and in 2005 also ran a special scheme to promote a charity event at the FedEx St. Jude Classic golf tournament. The car is driven by Denny Hamlin.
• FedEx sponsors the Formula 1 Team McLaren. The two cars on the team are driven by Lewis Hamilton of Britain and Heikki Kovalainen of Finland. Prior to that FedEx has sponsored Ferrari, Benetton (now Renault) and Williams F1.

Venues

• FedEx sponsors FedExForum, home of the NBA's Memphis Grizzlies and the University of Memphis men's basketball team.
• FedExField, an American football stadium in the Maryland suburbs of Washington, D.C.

See also

• Courier
• Package delivery

• ARAMEX (competitor)
• BAX Global (competitor)
• DHL (competitor)
• Purolator Courier (competitor)
• TNT (competitor)
• UPS (competitor)
• USPS (competitor and customer)

References

• Foust, Dean, Fredrick Smith: No Overnight Success, http://www.businessweek.com/magazine/content/04_38/b3900031_mz072.htm, retrieved on 2007-10-30 

• Bartiromo, Maria, The Inspiration Behind Federal Express: A Central Hub, http://www.rd.com/columnists/maria-bartiromo/the-inspiration-behind-federal-express/article28892-1.html, retrieved on 2007-10-30 

• Cato Institute, Does Fred Smith and FedEx Have Ed Crane and The Cato Institute In Their Back Pockets?, http://www.boycottfedex.com/cato.html, retrieved on 2007-10-30 

External links

Corporate Homepages

• FedEx - Index of national homepages
• Official FedEx Newsroom

Other

• Interview with Lindon Leader, designer of the FedEx Logo
• Fedex Corporate political contributions
• U.S. Mail holidays - UPS holidays - FedEx holidays - Internet Accuracy Project
• Summary report, corporate factsheet (The Globe and Mail)
• FedEx uniform
• Most recent Fedex quarterly conference call transcript on seeking Alpha
• Fedex organization chart

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