Spot on. As was noted earlier the contract is worthless because there's no governing legal authority in place with the power to make it binding on FDX.
Their biggest contractor had what, 250 routes? How many tens of thousands of routes are there? I bet those 250 are the ones that will kill the company!!!
A clear very public display of how impulsive and fickle Fedex can be when terminating contracts did ten times the harm to the business model than Patton did.
How many do you think it takes to have a significant ripple effect through the network? I guess if we just keep losing shippers as fast as contractors, you’ll say everything is great because the system still runs. Anything short of bankruptcy is a good plan, right?
I'm going to guess more than Patton's 250 or whatever it is (was) out of tens of thousands.
I guess your thing now is saying that things are going to be terribly bad, and when they aren't, take shots at people who notice.
Things are bad right now. Volume is down and dropping. You can pretend it’s all the overall economy’s fault but I don’t buy that excuse. What shot did I take at you? Or do you just need to be the victim for some reason?
Corporate paranoia and insecurity is more like it. No longer a good place to invest your money.
It will if they are lined up like dominoes.
Perhaps I should have worded it better. You respond to critiques of your takes with "anything short of a bankruptcy is a good plan, right" and the like. Heck, the infrastructure was going to be overwhelmed with freight mere weeks before you changed your mind and decided that the infrastructure was going to be starved.
And we read it here first!
It’s actually more messed up than that. The company has very high expectations of contractors but they don’t even come close to understanding their value. That is until they terminate contractors and then can’t fill the positions with solid candidates. The only thing holding Ground upright is the horribly low volume. Even with that low volume failing contractors is not an uncommon occurrence.
Express and Ground are having layoffs. Freight is having driver furloughs.
Professional investors, the MBA's, family trusts, private equity firms, the kind of people they want would first do a thorough evaluation of the offering and being who they are they would immediately see the systemic shortcomings and the risks they create along with the fact that the highest margins and asset appreciation went away several years ago. While the stock has made some gains as was pointed out earlier a company's stock price is a poor measurement of it's health given today's quick hit trading environment. Especially one that is a poor a setup to begin with and one that cannot be cheaply and easily streamlined.It’s actually more messed up than that. The company has very high expectations of contractors but they don’t even come close to understanding their value. That is until they terminate contractors and then can’t fill the positions with solid candidates. The only thing holding Ground upright is the horribly low volume. Even with that low volume failing contractors is not an uncommon occurrence.
It’s truly a dive into the trash barrel. Several years ago a team was formed to go out and find business people to acquire contracts. FedEx wanted those savvy business minds. Scavenging Facebook and Craigslist for whomever they can get to sign on the dotted line.
And yet the stock soars. It’s as though people think that since the company made it through peak all must be well. Somehow Raj and John Smith miraculously fixed the mess.
Will be interesting if the replace 10% of contractors with Facebook applicants. Even getting those folks ready for their first peak would be challenging especially while dealing with a continuing March of cure contractors out the door.
This. I'm not an expert on Ground but it should seem obvious to anyone considering doing business with FedEx what they're getting into. The usual suspects here like to remind us that 255 routes is "nothing" and that Patton was squashed like a bug. In terms of killing his routes, he was "eliminated", so if you're a much smaller player how are they going to deal with you? Also, it's pretty clear from researching Patton that he is still a big part of Ground because he's a route broker and vehicle lessor, primarily to Ground contractors. Hello? FedEx just "killed" Patton, but he lives on as an integral part of the company structure. This fact also speaks volumes about Ground itself. Why would competent management let someone like Patton weave themselves so strongly into Ground? He has vertically integrated himself as a player even though they made an example of him by terminating all of his routes. Look at what my right hand is doing but please make sure you ignore what the left one is up to, and pay no attention to the person under the table.
