In an effort to modernize its fleet, FedEx Express has ordered 27 Boeing 767-300 freighters, along with exercising options for two additional 777Fs. The first three 767s will enter service in fiscal-year 2014.
Subsequent deliveries are scheduled to occur between fiscal-year 2015 and fiscal-year 2018, with six 767-300Fs arriving each year. These freighters will replace FedEx Express’ MD10 aircraft, some of which are more than 40 years old, according to a press release.
FedEx Express CEO David Bronczek said the 767-300s will greatly complement his company’s cargo fleet. “The 767 freighter, with its solid efficiency among medium wide-body cargo airplanes, is an ideal solution to support our strategy of providing fast and reliable delivery to every U.S. address and to more than 220 countries and territories,” he said in a statement.
The logistics provider won’t be relying on the 777Fs as much as was previously reported, however. FedEx Express has delayed acquisition of 11 777 freighters to “better balance air network capacity to demand,” according to a press release.
Two of the 777Fs will be postponed from fiscal-year 2013, and five will be deferred from 2014; the remaining freighters were scheduled for delivery from 2015 to 2018, at the rate of one per year. “As a result of these deferrals, FedEx Express will place into service four 777s in fiscal 2013 and two in fiscal 2014,” according to the press release.
FedEx Corp. CFO Alan Graf, Jr., said adjusting capacity to meet demand is nothing new for FedEx Express. In fact, he stated, the logistics provider recently modified its frequencies to certain regions, particularly Asia, to address de-stocking trends.
“The deferral of our 777 aircraft deliveries is a continuation of those efforts, enabling us to make appropriately timed, international 777 capacity additions over the next decade,” Graf said in a statement. “With these actions, we expect fiscal 2013 capital expenditures to moderate to approximately $3.8 billion.”
Whether 2013 meets these expectations or not, the second quarter of 2012 was rather profitable for FedEx Express. Revenue for this segment rose 10 percent, year-over-year, in the quarter ending November 30, reaching $6.58 billion.