FedEx

Type: Public
Founded: 1971
Headquarters: Memphis, Tennessee, United States
Key people: Frederick W. Smith, Chairman, President, CEO, Alan B. Graf Jr., EVP/CFO, T. Michael Glenn, EVP-Marketing, Robert B. Carter, EVP/CIO
Industry: Air Courier
Products:
Website: www.fedex.com

General Information

FedEx (NYSE: FDX), whose full corporate name is FedEx Corporation, is a cargo airline, printing, and courier company offering overnight courier, ground, heavy freight, document copying and logistics services. FedEx is a syllabic abbreviation of the company's original name, Federal Express.

History

The company was founded as Federal Express in 1971 by honorably discharged U.S. Marine Fred Smith in Little Rock, Arkansas, but moved to Memphis, Tennessee in 1973 after Little Rock airport officials would not agree to provide facilities for the fledgling airline. The name was chosen to symbolize a national marketplace, and help in obtaining government contracts. The company officially began operations on April 17, 1973, utilizing a network of 14 Dassault Falcon 20s which connected 25 U.S. cities. FedEx, the first cargo airline that used only jet aircraft for its services, expanded greatly after the deregulation of the cargo airlines sector. Federal Express' use of the hub-spoke distribution paradigm in air freight enabled it to become a world leader in its field. The company operates much of its U.S. overnight freight through its Memphis hub. Other U.S. hubs are located in Indianapolis, Indiana; Columbus, Ohio; Newark, New Jersey; Oakland, California; Anchorage, Alaska; Fort Worth, Texas; Los Angeles International Airport; Miami, Florida; Baton Rouge Metropolitan Airport; and, soon, Greensboro, North Carolina. The Canadian hub operates from Toronto Pearson International Airport. Due for completion in 2008 is the new Asian-Pacific Superhub in Guangzhou Baiyun International Airport; replacing FedEx Express' current hub in Subic Bay, Phillipines in Southern China increasing service levels and demands in Southern Asia.

In 2005, FedEx Express began expansion of its Indianapolis hub, which by its projected completion in 2010 will be one of the largest FedEx Express hubs.

In August, 1989 the company acquired Flying Tigers, an international cargo airline. It inherited Flying Tigers's U.S. military transport contract and carried passengers between the continental United States and overseas military installations until October, 1992. In January, 1998, Federal Express acquired Caliber System, Inc, which owned Roadway Package System, Roberts Express, Viking Freight, and Caliber Logistics. When these companies combined, the new organization became known as FDX Corp. The name 'FedEx' had been a popular, if unofficial, abbreviation for Federal Express for several years before the company chose it as its primary brand name in 1994. The new identity was revealed to the world on June 24, 1994. The 'Federal Express' name was eliminated entirely in 2000, when FDX Corporation changed its name to FedEx Corporation and adopted the tagline 'The World On Time'. In 2000, FedEx and the USPS signed a 7-year contract to carry all the USPS overnight and high-priority mail throughout the FedEx system. The postal contract has recently been extended until 2012 and USPS continues to be one of the largest customers for FedEx. In 2001, FedEx acquired American Freightways [citation needed], a leading less-than-truckload (LTL) carrier, and combined them with Viking Freight to create FedEx Freight. In February 2004, FedEx bought Kinko's, a Dallas-based chain that provides copying/printing and business services, for $2.4 billion (most likely in response to UPS acquiring Mailboxes Etc). In May 2006, FedEx acquired the assets of Watkins Motor Lines, a leader in long-haul LTL freight transportation for $780 million cash. The purchase allowed FedEx to provide more choices for heavyweight deliveries, expanding its portfolio to meet customer demands. The company has been rebranded as FedEx National LTL, and is part of the Fedex Freight segment.

In its advertising, the company made famous the line 'Absolutely, positively' for their overnight service; the original phrase was 'When it absolutely, positively has to get there overnight.' Another slogan, 'Relax, it's FedEx', is well recognized. For several years the company promoted the slogan 'Don't panic', particularly on buttons. Throughout Europe, the marketing tag line is 'whatever it takes'. One major exception is Interior Alaska outside of Anchorage or Fairbanks local areas. Overnight packages are transferred to the United States Postal Service and then shipped either parcel post or first class mail with no tracking ability. FedEx marks the tracking of these items as 'Delivered to customer' when the USPS receives the items.

Major competitors include UPS, DHL, and TNT, in addition to post office organizations around the globe.