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FedEx highlights cargo drive as it reports Q3 finacials

FedEx has revealed that it is targeting the freight volumes of existing parcel customers as it looks to expand in high-vale verticals. When announcing the company's third-quarter results, chief executive Raj Subramaniam highlighted efforts to win more air cargo volumes. "Our expanding capabilities across key verticals are enabling us to address more of our customers' logistics needs and unlock airfreight demand from traditionally parcel-centric customers," he said. "For example, we drove a 15-fold increase in aircraft engine moves and won new airfreight business with an AI data centre customer after a more than 40-year largely parcel-centric relationship. "Differentiation is increasingly centred on deep customer relationships and tailored service experiences, positioning us to capture more freight volume as we address customers' needs beyond parcel." As well as AI/data centres, healthcare, aerospace, defence and automotive are other focus areas. International airfreight daily freight pounds were up 15% year on year, the company said. He said the focus on winning cargo volumes from existing customers had helped drive third-quarter revenue growth at the company. Figures for the period show that FedEx revenues improved by 12% year on year to $22.9bn. Operating income also improved, increasing by 16% year on year to 1.2bn. Net income for the third quarter was down to $290m from $650m last year, but this metric was affected by costs in association with the spin-off of FedEx Freight as part of efforts to focus on its core express business. The company has also recently sold off its supply chain business to the CMA CGM Group. FedEx said its operating results improved in the third quarter, driven by increased package base yields, higher package volumes, and continued structural cost reductions from business optimisation initiatives. These factors were partially offset by increased purchased transportation rates, higher wage rates and variable compensation expenses, and the financial impact of global trade policy changes. "We have the right strategy in place to continue to be the world's premier B2B parcel and air freight provider, leverage our digital insights to unlock new markets, and use disciplined capital allocation to create additional stockholder value," said Subramaniam. Express US Domestic segment operating income increased during the quarter, driven by higher package yields, increased package volume, improved service mix, and continued cost savings from transformation initiatives. These factors were partially offset by increased purchased transportation rates and higher salaries and benefits expenses. Express International segment operating results increased during the quarter, primarily due to increased base yields, higher international export volume, and increased freight weight. These factors were partially offset by higher wage rates, increased purchased transportation rates, and the financial impact of global trade policy changes.

Major liners set to resume all Asia-Europe services through Suez

All the mainline operators look set to resume Suez Canal transits for their Asia-North Europe and Asia-Mediterranean services. Taiwan's Evergreen will join its Ocean Alliance partners in doing just that this week, while Yang Ming and South Korea's HMM will join their Premier Alliance partners restarting Suez crossings next month. Linerlytica's report today says Evergreen will send the 16,556 teu Ever Eon and Ever Edit on eastbound Suez transits on the Ocean Alliance's NEU7/CES service on 7 and 11 November, respectively, with the 20,124 teu Ever Gifted on the alliance's MD2 service on 16 November. The Premier Alliance's Asia Mediterranean 1 (MD1) service will resume Suez transits next month, adding a new call at Sokhna to cater for Asia-Red Sea cargo. The revised MD1 rotation will call at Ningbo, Shanghai, Shekou, Singapore, Sokhna, (Suez Canal), Damietta, Ambarli, Izmit, Mersin, Damietta, (via Suez), Singapore, Kaohsiung, and Ningbo, starting with Yang Ming's 11,714 teu YM Trust at Ningbo on 13 November. The revised MD1 will turn in 84 days and will deploy 12 ships of 11,700 to 14,000 teu from Yang Ming, compared with 16 ships on the present Cape route. Shipping lines turned away from Suez and diverted vessels round the Cape of Good Hope in late 2023, after the Houthis began attacking vessels in response to Israel's conflict with Palestine. In recent months, vessel capacity constraints, and competitive pressures following a temporary easing of regional security risks, have convinced shipping lines to resume Suez crossings. Israeli carrier Zim is the only major shipping line sticking to the Cape route, possibly due to its nationality. HMM's spokesperson told The Loadstar South Korea's flagship carrier had assessed the risks before deciding to resume Suez transits. She said: "This matter was decided and agreed upon from a Premier Alliance perspective, following a comprehensive review of market conditions and safety aspects." Linerlytica said: "All three main carrier alliances, along with MSC, are set to make a full return to the Suez by Q1 27, leaving Zim as the only main carrier left on the Cape route." The Gemini Cooperation partners, Maersk and Hapah-Lloyd, have also signalled a full Suez resumption by Q1 27, and launched a new Asia-Mediterranean service that passes through the canal. The shortened sailing times do not augur well for Asia-Europe and Asia-Mediterranean rates, however, with the 1 November price hikes failing to gain traction, and further rate declines are expected in the coming weeks, as supply growth is not outpacing growth in demand. With this, shipping lines are also adding more Red Sea calls to capitalise on rising Shanghai-Persian Gulf rates. Evergreen is relaunching its China-Red Sea service on 12 November to coincide with the resumption of its Suez transits. The OGRD service will call at Qingdao, Shanghai, Ningbo, Shekou, Singapore, Jeddah, Sokhna, Aqaba, Jeddah, Port Klang, and Qingdao. The service will turn in 56 days but will initially only deploy four 7,000-9,000 teu ships, operating on a fortnightly basis starting with the 7,024 teu Ever Superb at Qingdao. MSC has extended its Far East-Indian subcontinent Shikra service to Khor Fakkan in the UAE and Oman's Sohar port, as it capitalises on the high demand and freight rates to the Middle East, despite severe congestion at these ports. The first Khor Fakkan call was made on 18 October, by the 24,346 teu MSC Micol under the new Shikra rotation that calls at Dalian, Xingang, Qingdao, Shanghai, Ningbo, Nansha, Singapore, Nhava Sheva, Mundra, Khor Fakkan, Sohar, and Dalian. The extended service will turn in 15 weeks, using up to 15 14,000-24,000 teu ships. The largest of them will call at the western Indian ports as well as Khor Fakkan and Sohar. These ships will face severe delays, especially at Khor Fakkan, with waiting times of more than two weeks to berth.

Aerion appoints Ceva head of airfreight procurement

Aerion has appointed former Ceva's head of airfreight procurement and carrier management, César Penciolelli, as its new head of global airline partnerships and commercial development. Penciolelli took up the role at the start of October and will work across Aerion's various businesses with a particular focus on airline partners where he will "strengthen dialogue with airlines, understand their priorities and connect them with the relevant expertise and capabilities available across the group". Penciolelli began his career in strategy and operations consulting, including positions at Strategy&, part of PwC, and EY. He later joined Ceva Logistics, first within the group chief operating officer's team and subsequently leading global air procurement and carrier management within the air product organisation. Adrien Thominet, chairman of holding company Quito Group and founder of Aerion, said: "César's experience and understanding of airline partnerships make him particularly well suited to this role. "His transversal position will strengthen the way we connect our capabilities around our airline partners and remain closely aligned with their priorities." The Quito Group includes ECS Group, Global GSA Group, TCE, CargoTech, Mail and More and HealthC'Air and created Aerion as a top-level platform that can sell across the various businesses. "Having worked closely with airlines from the buying side, I understand the importance of strong relationships, clear priorities and solutions that respond to real operational needs," Penciolelli added. "Aerion brings together a wide range of expertise. My role is to work across these businesses and with our teams to make those capabilities as relevant and accessible as possible to our airline partners."