The Colography Group estimated that slightly more than 50% of FedEx's 2005 domestic shipments will move either via its ground parcel services (FedEx Ground) or its less-than-truckload subsidiary (FedEx Freight). About 48.9% of its domestic shipments will move in ground parcel services, while slightly more than 1.1% will move via LTL.
The Colography Group projected that shipments moving via air (FedEx Express) will comprise 49.9% of FedEx's shipment mix. This marks the first time the percentage of FedEx's domestic traffic moving by air has fallen below 50% in a given year.
"This is a watershed event, but not an unexpected one," said Ted Scherck, President, The Colography Group. "The gap between FedEx's air and surface shipment mix has been narrowing for the past seven years, starting about the time FedEx acquired the parent of the former Roadway Package System and challenged UPS' dominance of the domestic ground parcel segment."
Scherck added, "If our projections are accurate, this trend will persist for years to come with surface transport representing an ever-larger share of FedEx's U.S. shipping mix. This reflects the growing role of ground transportation in the national economy."
The data driving the FedEx forecast was extracted from two newly released Colography Group publications that track expedited air and surface transport activity on a quarterly and annual basis: US Domestic Surface Traffic And Yield Analysis By Competitor And Market Segment, and US Domestic and Export Air Traffic And Yield Analysis By Competitor And Market Segment.
Among some of the findings from both publications:
- US domestic ground parcel shipments rose to 3.94 billion in 2004, up from 3.73 billion in 2003. FedEx Ground gained the most market share year-over-year, with DHL Express'the combined DHL/Airborne Express'increasing its share slightly. UPS remained the market leader, but its year-over-year share dipped slightly.
- Total LTL shipments rose by approximately 5.4 million to 127.2 million. Revenue rose $2 billion to $20.09 billion. Of the five "super-regional" carriers'FedEx Freight, Overnite Transportation, ABF Freight System, the Con-Ways and USFreightways-- FedEx Freight, ABF Freight and the Con-Ways gained shipment share year-over-year. Yellow Roadway, the lone national carrier, lost shipment share year-over-year.
- Domestic air shipments in 2004 totaled 2.45 billion and generated revenue of $31.84 billion. This represented a year-over-year decline in shipment count but an increase in revenue, underscoring the impact of fuel surcharge pass-throughs on carriers' revenue streams. The US Postal Service held the largest shipment share, followed by FedEx Express, UPS Air and DHL.
- Due to fuel surcharge pass-throughs, revenue for the average overnight air shipment rose strongly in 2004, ending the year at $18.11. Revenue for the typical deferred air shipment also increased through 2004, ending the year at $9.19.
- US air exports posted robust gains in 2004, with shipment count climbing to 85.5 million from 79.2 million in 2003. Revenue rose strongly to $8.4 billion from $7.5 billion in 2003.
