FedEx to suspend Sunday deliveries in some U.S. markets

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FedEx Corp said on Thursday it is suspending Sunday delivery operations in some low-density, rural U.S. markets starting from Aug. 15.

The U.S. delivery giant said the move will increase the efficiency of its Ground unit which handles the bulk of the company’s e-commerce home deliveries and reach nearly 80% of the U.S. population on Sundays.

FedEx is optimizing its delivery network based on market conditions and customer needs, the company said in an emailed statement to Reuters. The company had started Sunday deliveries to match with the sudden rise in demand after the COVID-19 pandemic struck in early 2020.

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“We accelerated the rollout of Sunday residential delivery coverage to nearly 95% of the U.S. population. As economic conditions have shifted, we are making operational adjustments to suspend Sunday delivery operations…,” it said.

Fedex did not clarify the specific markets that would be affected by the new policy.

The decision comes as the company deals with cooling demand and its Ground unit contractors who want more money to offset their rising costs.

At least two brokerage firms had cut its target price on FedEx’s stock earlier this month. (Reporting by Shubhendu Deshmukh and Shivani Tanna in Bengaluru; Editing by Rashmi Aich)

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