Thursday, March 23, 2023

Live news: FedEx to cut global leadership team by more than 10%

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FedEx will cut more than 10 per cent of its global leadership team, adding to the more than 12,000 employees it has shed over the past seven months.

The company will also consolidate some teams and functions, building on plans announced last year to cut costs and streamline its operations in response to weaker consumer demand.

“It is my responsibility to look critically at the business and determine where we can be stronger by better aligning the size of our network with customer demand,” chief executive Raj Subramaniam said in a statement on Wednesday.

FedEx employed about 345,00 permanent full-time workers and 202,00 permanent part-time employees as of May 31, 2022, according to its most recent annual report.

The company has reduced its headcount by more than 12,000 positions since June last year through attrition and job cuts, a FedEx spokeswoman told the Financial Times.

The lay-offs add to a growing wave of job cuts among US companies, that were initially concentrated among technology groups, but in recent weeks have broadened out to include other sectors.

FedEx has struggled to extend some of the success it enjoyed during the pandemic, when many consumers were stuck at home shopping online and companies shelled out the privilege of having goods sent or received speedily.

In September, the company announced a hiring freeze and the closure of more than 90 of its FedEx office stores. The company said in December it expected to cut a further $1bn of costs in fiscal 2023, bringing savings in fiscal 2023 to $3.7bn. In January, it announced reductions to its Sunday delivery service.

FedEx shares were up 2.7 per cent in afternoon trading on Wednesday, following the news, but the company’s stock has underperformed rival UPS over the short- and medium-term.

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