A banner holiday shipping season is in the cards, according to FedEx Corp., which is also planning to increase rates for 2008.
The company expects to break its own volume records by moving 11.3-million packages through its FedEx Express and FedEx Ground networks on Dec. 17 this year. On an average day, FedEx typically moves 7-million packages.
“While overall economic growth has slowed, there are several indicators for a healthy holiday season,” said Frederick Smith, FedEx’s chairman, president & CEO. “Consumer spending remains steady and e-commerce will continue to drive holiday spending, while sales of luxury goods and electronics should remain strong.”
Smith pointed to several market analyses to back up those predictions. One, from consulting firm TNS Retail Forward, said online sales are projected to approach $42 billion in the fourth quarter of 2007, an 18.5% increase over the last holiday season. The National Retail Federation said that overall holiday sales would continue to rise, although they are projected to be the slowest since 2002. Holiday spending is projected to increase 4% to $474.5 billion over last year.
On the strength of that business, FedEx is also preparing to raise its rates starting Jan. 7, 2008, for all U.S. domestic and U.S. export express package and freight shipments. The company said it would increase the net average shipping rate for FedEx Express by 4.9%, comprised of 6.9% boost in standard list rates, offset by a 2% reduction in its fuel surcharge. Rates and surcharges for FedEx Ground also will increase for 2008; details will be announced later in the year.