FedEx intends to send around eight narrowbody freighters into storage as part of a plan to reduce costs amid more challenging market conditions, according to the express integrator during its quarterly earnings call with analysts today.
Executive Vice President and Chief Financial Officer Michael C. Lenz indicated the company will reduce flight frequencies and place aircraft into temporary storage to generate a total savings of $1.5-1.7 billion for the Express division in its fiscal year 2023, which began June 1.
FedEx Express’ narrowbody jet fleet in North America consists only of 119 757-200Fs, according to the company’s latest Statistical Book released today. However, not all of these are operational: two (26677 and 26710) were sent to Victorville (VCV) in July and August, respectively, while around six others are currently inactive at other locations but are likely undergoing maintenance and four have been parked since 2019 and 2020, based on Cargo Facts research.
The express integrator plans to reduce service by 17% on its Asia-Europe routes, 11% on its trans-Pacific routes and 9% on its trans-Atlantic routes, FedEx President and Chief Executive Officer Raj Subramaniam said during the call.
Meanwhile, even as FedEx implements its cost-savings strategy to offset growing inflation, the company is still preparing for the yearend peak by bringing classic widebody freighters back online. A 1976-vintage MD-10-30F (46871) that arrived at VCV in late March returned to Los Angeles (LAX) on Sept. 14 for maintenance ahead of reentry into service and a 1999-vintage MD-11F (48801) that FedEx acquired from Lufthansa in 2020 finally began flying earlier this month after being reactivated at the end of 2021.
As FedEx initiates the return of unit 46871 back into service for the peak season, the company is still intent on retiring all nine of its MD-10-30F widebody freighters by May 31, 2023, while upgrading its fleet with younger aircraft. Just last week, FedEx took delivery of the factory-built 767-300F (66869) and as of Aug. 31 had a commitment to purchase thirty-four more of the type.
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