How will FedEx beat back Amazon’s challenge? Here’s a hint

Last year, FedEx placed a launch order with Textron for 50 Cessna SkyCourier 408 feeder freighters. A diversified freighter fleet and delivery network are what FedEx believes give it an edge over rising logistics players like Amazon.

FedEx yesterday offered a glimpse at how the express company will fend off competition from Amazon, which continues to develop its own Amazon Air dedicated air network.

The secret: infrastructure.

David Cunningham, president and CEO of FedEx’s express business, said during a presentation before the Wings Club in New York yesterday that FedEx’s infrastructure gives it an advantage over Amazon.

“The scale of FedEx — and UPS, for that matter — the hubs, the infrastructure we have built over 40 years, those things are not easily built,” Cunningham said in response to a question on how FedEx would overcome competition from Amazon.

Previously in his presentation, Cunningham laid out the scope of FedEx, which, for example, employs more than 425,000 worldwide.

Separately, Cunningham during his presentation touted FedEx’s ATR 72-600 and Cesna turboprop acquisitions. He said FedEx worked directly with ATR on aircraft design, and that the manufacturer will go from “clean sheet to delivery” in three years. Before the FedEx deal was announced last year, ATR offered only the passenger variant of its popular turboprop aircraft. All in-service ATR 72-600Fs are freighter conversions.

Cunningham added that FedEx continues to pursue its goal of reducing the company’s emissions. He said FedEx “will reach that goal” of reducing its 2005 emission levels by 20% by the year 2020.

Learn more about e-commerce and its impact on demand for freighter aircraft on 10-12 October at Cargo Facts Symposium, where a roundtable panel discussion will be dedicated to the topic. For more information, or to register, visit www.cargofactssymposium.com.

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