FedEx predicts increase in holiday deliveries

FedEx Truck (KSN File Photo)

MEMPHIS, Tenn. (AP) — FedEx expects another record for holiday-season deliveries.

The company forecast Wednesday that deliveries between Thanksgiving and Christmas Eve will rise 8.8 percent over last year, to 290 million shipments. That’s a more subdued forecast than a year ago, when FedEx predicted 13 percent growth for the season.

Volume is expected to surge on each of the first three Mondays in December.

FedEx Corp. said the peak day is likely to be Dec. 15, when it expects to handle 22.6 million shipments around the world.

FedEx and rival United Parcel Service Inc. struggled last year with severe winter weather in early December, a shorter holiday season, and a surge in late orders that was partly due to retailers promising free delivery even for shipments close to Christmas Day.

FedEx plans to add 50,000 seasonal workers to help carry the load this year. UPS has said it will add up to 95,000 people, and Amazon said it will hire 80,000, a 14 percent jump over last year.

The delivery companies and Internet retailers are benefiting from the trend toward online shopping and are banking on a strengthening economy and optimism about consumer spending. They are boosting hiring to meet consumers’ expectations that easy shopping on their computers and mobile devices can be paired with quick delivery of the goods.

FedEx expects to invest $1.2 billion in its ground-shipping network in its current fiscal year, with most of that going to increase capacity and automation. The company said that the improvements have sped up ground delivery by a day or more in more than two-thirds of the U.S.

The Memphis-based company said that the holiday-shipping forecast is included in its outlook for the fiscal year ending next May. The company said last month that it expects full-year earnings of $8.50 to $9 per share, assuming moderate economic growth. Analysts expect $8.99 per share, according to a survey by FactSet.

FedEx shares rose $1.02 to $160.90 in trading before the bell on Wednesday. Through Tuesday’s close, they were up 11 percent in 2014.

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