FEDEX VERSUS UPS
Sure, I am a little biased when it comes to choosing between the two. If it weren’t for Mike Scanlan, our FedEx rep when we opened our doors sixteen years ago and the help he and his team gave us, there might not have been a company that next month will be celebrating its sixteenth birthday. Yes, some smart Alecs did arrive on the scene at Memphis H.Q. in the late nineties to make us feel miserable enough to switch over to UPS for a few years, but if any CII staff members are asked today where their preference is, all would yell in unison, “FEDEX!” In L.A. FedEx’s Beverly Bolin and Mike Scanlan sixteen years later are still looking after CII’s best interests.
As far as UPS is concerned, I couldn’t care less if they are in the forwarder business or not. Maybe if I were some Bible bashing evangelical Christian, UPS and I would still be great buddies, but my business relationships require far more substance than “speaking in tongues”. Every time I see an ugly, ancient looking UPS van go rumbling by painted up in its 100 plus year old toilet brown livery I compare it to the bright white, orange and mauve FedEx attired trucks and say to myself, those guys in Atlanta still have their heads firmly stuck up their “you know whats”. I can’t believe it, it is obvious the boys from “Oops” in many ways are proud of still being stuck in the nineteenth century! By contrast FedEx stands for and is a perfect example of the American dream come true, while UPS should have stayed in Seattle delivering furniture by horse and cart!
Fred Smith, who founded FedEx, knew from the get-go that he had to keep that Mafia dominated Brotherhood of Teamsters’ Union out of the equation. This wasn’t because they controlled UPS, but it was an evil organization hell bent on graft and corruption and Fred Smith saw no future for his company with that involvement. In fact UPS was a trucking company (therefore its workers were teamster controlled) of longstanding and only got into the overnight airfreight business because if it hadn’t, FedEx would have “cleaned their clock”. FedEx drivers were organized under the Railway Labor Act, which blocks workers at railroads and airlines from organizing themselves at a local level. UPS now wants to see FedEx stripped from its right to bargain under this act.
Congress is in a dilemma as both UPS and FedEx are huge political party donors and as well as major spenders on lobbying. Over the past few years, labor unions have lost significant influence inside the Democratic Party and UPS with nearly 260,000 Teamsters in its ranks is not exactly the company the Republicans want to openly support for obvious reasons. Fred Smith is claiming that if legislation is passed which makes FedEx exempt from the Railway Labor Act, he will be forced to downsize his company and all future Boeing aircraft orders may have to be canceled.
I am taking sides here. The United States needs FedEx, even if it is just for the USPS to deliver our mail in a timely fashion. Furthermore, we probably no longer need even two overnight delivery companies. DHL, the third overnight integrator suddenly died in January, life went on as usual and quite frankly apart from 9000 workers in Wilmington, Ohio, no-one mourned its passing. If UPS suddenly decided to get back into the business it was created for in the first place, transporting and delivering parcels by road, it might just be a good thing. The last thing I do know and that is we don’t need FedEx unionized because of the poor sportsmanship of UPS.
Now the world is turning green, do we need 1000 half laden aircraft filling U.S. air space every night emitting all those pollutants? I’m all for economies of scale. Maybe UPS should go the way of USPS and contract their airfreight to FedEx. They might make more money and have a happier customer base. Once an old salt of the industry a few years ago said to me, “UPS is a trucking company trying be an airline and FedEx is an airline trying to be a trucking company.” I think there is a certain truth to that. For the sake of the environment, can I ask Scott Davis, CEO of UPS, to consider pulling out of airfreight altogether. It might also help your balance sheet no end.
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Matt
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Matt
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John
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John
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