PARCEL NEWS
PAR CEL NEW S T
he fourth quarter each year brings holiday shopping that floods the market with millions of packages needing timely deliveries. The fourth quarter 2019 was no exception, as an estimated two billion packages were delivered between Thanksgiving and Christmas. Both United Parcel Service Inc. (UPS) and FedEx Corporation (FedEx) announced rate increases, with UPS’ increases going into effect on December 29th, and FedEx’s increases waiting until January 6th to go into effect. • UPS raised the rates for its UPS Ground, UPS Air and International services by an average of 4.9% on December 29th. UPS announced this two months after FedEx announced their 4.9% rate increase that goes into effect on January 6th. (Logistics Management) • Next-day air shipping volume at UPS increased 24% in the third quarter, which helped increase profit to $1.75 billion. Domestic package revenue also rose 9.8%. (WSJ) • UPS and Michaels Cos. Inc. announced a partnership that will have over 1,000 of Michaels’ stores become pick-up and drop-off locations for UPS packages. (MarketWatch) • UPS received approval from the Federal Aviation Administration (FAA) to begin setting up a fleet of drones to deliver health supplies and consumer packages throughout the United States. The FAA’s approval allows UPS to begin using drones to transport medical products, starting in Virginia. (WSJ) • Between 2020 and 2022, UPS plans to purchase 6,000 natural gas-powered vehicles. (Supply Chain Dive) • UPS hired a significant amount of temporary workers to deliver packages using their own personal vehicles to keep up with the flood of holiday deliveries. (Bloomberg)
• With Thanksgiving falling on the latest possible date (November 28), delivery companies only had 23 days between Thanksgiving and Hanukkah and only 26 days between Thanksgiving and Christmas to deliver packages. The holiday season brings in an estimated two billion packages that need delivered. (WSJ) • Walgreens and FedEx announced a partnership that will allow customers to print out return labels for FedEx shipments at Walgreens stores. (Commercial Appeal) • FedEx announced it was closing the pension plan to new U.S. hires starting in 2020, something UPS did back in 2016. FedEx will instead begin offering a 401(k) plan at the beginning of 2021. (WSJ) • FedEx is testing an autonomous delivery robot in Dubai. Located in the United Arab Emirates, Dubai became the first city outside of the United States to host the autonomous delivery device named Roxo. Roxo is designed to travel on sidewalks and along roadsides, which would allow it to help with last-mile deliveries. Roxo is equipped with technology allowing it to detect and avoid obstacles and plot a safe path, all while following road signs and safety rules. (Gulf News UAE) • Deutsche Post DHL Group expects to invest $2.2 billion on digital initiatives through 2025. (WSJ) • Purolator Inc., a Canadian parcel-delivery company, is spending over $1 billion (over $760 million US) in an attempt to keep up with e-commerce demand. This spending includes a new automated hub in Toronto, increasing the size of its delivery fleet and adding specialty service vans where consumers can pick up packages from the truck rather than having them delivered to their homes. (WSJ)
Q4 2019 • Volume 12 • Page 8