FDX future vs. UPS

[BrownShark]

(wall street journal 12/07)

Maybe in Wall Street's view UPS didn't have a tremendous 2007 but the recent announcements regarding FDX's legal issues may finally level the playing field. According to information already announced, FDX faces a $319 million improper classification of independent contractor fine/penalty obligation for just 2002. The Teamsters suggest that the total exposure may exceed $1B. That along with the higher future cost of doing business (like UPS has been facing all along) and the internal legal expenses must be part of the larger picture as well. Certainly this major issue is part of the reason FDX's shares are sliding to near $90.

The 2nd legal issue regarding FDX just got hairier. The DOJ has issued a Grand Jury subpoena for further information/testimony regarding the on-going charge of anti-competitive behavior regarding their international air freight business. Granted, UPS was also mentioned early on regarding this issue but has not received a similar subpoena (or it has not been announced yet if they have).

So, it would be interesting if UPS is able to continue to outperform FDX operationally while FDX is also subject to heavy financial setbacks related to these 2 issues. I for one would liken this situation to the hair and tortoise comparison as UPS has been around for quite some time and has worked well (mostly) with the Teamsters and have provided outstanding benefits for their employees. (end)

Brazenblown said this:"After giving it more thought does UPS really need the union?
Look at FedEx, sure they don't make as much but they don't work as hard and they don't make 50% less that we do..FedEx didn't have to bail out a screwed up Central States plan either. Maybe UPSers would be making more money than they do now if UPS didn't have to put up billions to rescue that debacle.

So much for those UPSer's who swear FEDEX is eating our lunch. Looks like FEDEX is having their lunch money taken!!

HAHAHAHAHAHAHA

Peace.

 

[Fredless]

Brazenbrown = pwnt.

/thread

 

[satellitedriver]

Brazenbrown = pwnt.

/thread

I am slow.
What is pwnt?

 

[brownrodster]

I am slow.
What is pwnt?

It is an alternate spelling and or pronunciation of the word "owned." To own someone means you not only defeated them but in doing so you also embarassed them.

pwnt could be pronounced as 'owned', 'poned', 'pon't,' or anything else you dream up.

The word 'pwnt' is from the internet gamer language known as 'leet', '1337', '31337', 'uber leet', 'uber1337', etc...

 

[edd_tv]

isnt owned only one more letter than pwnt?

 

[Coldworld]

If ups didnt have to make a 6.1 billion payment to cs, they could have bought fedex.

 

[TSG92]

We should have bought them when they were little.

 

[FAVREFAN]

Interesting.....last time I checked......Fedex(FDX) had a market cap of $29Billion still even after being severely punished by Wall St. in recent weeks. We are around $78Billion. $6.1Billion wouldn't buy much of FDX.
Doesn't look so good for the other guys from here on out. If the Teamsters can get in there full blown......we would be on a more level playing field and we could dominate them. Not like they are ever going away. Just much less profitable if they get unionized.

 

[govols019]

isnt owned only one more letter than pwnt?

Yeah, but that wouldn't be cool.

 

[DorkHead]

All these thoughts are good. But remember, the stronger our competition gets, the better our bargaining position gets!! Just another thought

 

[brazenbrown]

Brazenbrown = pwnt.

/thread

Owned by the likes of you, Yeah right!

And what do you stand for other than using a cute slang word to try and assert yourself in some kind of bizarre fashion??

 

[Coldworld]

They could have bought 1/4 of fedex, intergrated the ground and air. Then think of all of the money ups would get for selling off unwanted land, buildings, trailers, tractors, etc. Then they could sell off fedex sorry trade solutions, and their new ltl service, but keep the fedex freight. So after all of that, yes ups would have to take on some debt, but they could totally do it. Then ups needs to purchase TNT, or some other major worldwide logistic company to compete with dhl in the worldwide mail and logistic area. Its possible.

Interesting.....last time I checked......Fedex(FDX) had a market cap of $29Billion still even after being severely punished by Wall St. in recent weeks. We are around $78Billion. $6.1Billion wouldn't buy much of FDX.
Doesn't look so good for the other guys from here on out. If the Teamsters can get in there full blown......we would be on a more level playing field and we could dominate them. Not like they are ever going away. Just much less profitable if they get unionized.

 

[Coldworld]

Ups had air in the 1930's. Our founder of this company wanted to continue with the service through the depression, but other people in the company thought that was a terrible idea. The service was then gone. If Ups would have kept it going, there probably would never have been a fedex as we know it today. Something else, at one time ups was also looking at dhl to help their international position, but like anything else, they didnt think it was a "good" idea. If you look at fedex, and dhl, each company is about 30-40 years old? Each have done very well, so has ups, but one has to start looking at why fedex and dhl have been able to get so big so fast, while ups has taken 100 years to do it. Each of them have used weaknesses in OUR company and built their systems around them. What is ups going to do in the next 20 years to grow our volume and maybe venture out into other interests. I personally think ups should buy tnt, and start getting into the mail business. How about paypal, that would have been a greqat business to snag up, would have gone great with ups capital, since we will be seeing more and more online shopping in the next few years. I think ups is going to have to start being like GE, where they are in many different core areas. Its interesting to think about.

 

[Babagounj]

Something else, at one time ups was also looking at dhl to help their international position, but like anything else, they didnt think it was a "good" idea.

As I recall the reason that idea died was that most of dhl's international deals were done by handshake, no paper trails could be found. Also dhl way back then is not the same as dhl today, they were only a document shipper.

 

[Coldworld]

As I recall the reason that idea died was that most of dhl's international deals were done by handshake, no paper trails could be found. Also dhl way back then is not the same as dhl today, they were only a document shipper.

Its interesting to think about if dhl was bought by ups, and how different the international scene would be today.

 

[Fredless]

Owned by the likes of you, Yeah right!

And what do you stand for other than using a cute slang word to try and assert yourself in some kind of bizarre fashion??

Didn't say I did. Good reading comprehension skills.

 

[FAVREFAN]

Ups had air in the 1930's. Our founder of this company wanted to continue with the service through the depression, but other people in the company thought that was a terrible idea. The service was then gone. If Ups would have kept it going, there probably would never have been a fedex as we know it today. Something else, at one time ups was also looking at dhl to help their international position, but like anything else, they didnt think it was a "good" idea. If you look at fedex, and dhl, each company is about 30-40 years old? Each have done very well, so has ups, but one has to start looking at why fedex and dhl have been able to get so big so fast, while ups has taken 100 years to do it. Each of them have used weaknesses in OUR company and built their systems around them. What is ups going to do in the next 20 years to grow our volume and maybe venture out into other interests. I personally think ups should buy tnt, and start getting into the mail business. How about paypal, that would have been a greqat business to snag up, would have gone great with ups capital, since we will be seeing more and more online shopping in the next few years. I think ups is going to have to start being like GE, where they are in many different core areas. Its interesting to think about.

Many good points here. I agree to a point. But we are allready diversifying into alot of other segments, total company solutions and logistics, capital and financing, etc........When you are on top, there is nothing to do but lose market share eventually and that is why FDX and DHL have grown quicker. Compare apples to apples though. UPS was nothing 30 years ago either. We were a grain of sand compared to our size today. We have grown exponentially.
As far as buying 1/4 of FDX. Can't happen. Would need a hostil takeover with a major majority of shares bought. FDX would never let it happen nor would the U.S. government........Anti-trust laws. We can and should coexist prosperously. We need to watch DHl and inhibit their growth. Later.

 

[Cole]

coldworld,
very true Casey did have the idea for moving pkgs by plane pre depression, and it was shot down, which eventually led the way for FDX. Then UPS wanted to jump on it.

 

[tieguy]

coldworld,
very true Casey did have the idea for moving pkgs by plane pre depression, and it was shot down, which eventually led the way for FDX. Then UPS wanted to jump on it.

some truth. we actually started an overnight delivery service in 1929. It ran approximately 3 years before we discontinued the service. I don't think we had a lot of demand for the service during the depression.

We later started blue label air which never took off like fdx overnight did.

We had the idea, fred had the marketing to convince customers they needed this service.