FedEx and UPS are looking at bad weather up and down the East Coast, putting many on edge about whether their presents will arrive in time for the holidays.
Thomas Black reported for Bloomberg that both carriers are avoiding issues such as those in 2013:
United Parcel Service Inc. (UPS) and FedEx Corp. (FDX) report package deliveries are running smoothly on the eve of the last regular day before Christmas as extra workers and favorable weather help avert last year’s missed deadlines.
UPS, the world’s largest package delivery company, handled its highest one-day volume yesterday and “everything is working well,” said Andy McGowan, a spokesman. FedEx had its peak day on Dec. 15 and package volume for the season is projected at 290 million, up 8.8 percent from last year.
“We’re super proud of how our team and network are performing this holiday season,” said Connie Avery, a FedEx spokeswoman, in a phone interview today. “We’re still busy.”
UPS, based in Atlanta, and FedEx have been preparing for this test for months. Both hired more temporary workers, updated technology, and invested in infrastructure to make sure they could handle rising demand from online purchases that caught them off guard last year.
Weather didn’t cooperate during the winter of 2013-2014 as an early December ice storm clogged up logistics hubs such as Dallas. Milder temperatures this year have helped manage the package demand.
CNN Money reporters Christina Alesci and Gregory Wallace wrote about the elaborate ways the companies try to combat delivery delays:
Forecasters at both UPS and FedEx sit in a control center alongside the teams that schedule crews, dispatch planes, develop contingency plans and keep the day-to-day operations flowing. Their job is to look at both the big picture — say, a hurricane barreling towards the coast — and the conditions for individual takeoffs and landings.
“Occasionally we’re wrong and we hear about it,” Baker said.
That’s what happened last year, when many packages from Amazon (AMZN, Tech30)weren’t delivered in time for Christmas. While badweather was a factor, UPS underestimated a last-minute surge in orders. Major companies like Amazon actually give UPS and FedEx projections about their volume.
FedEx’s team of 15 meteorologists provide “a crystal ball” as early as ten days out, Paul Tronsor, FedEx’s managing director of global operations, told CNNMoney. That’s a big help in keeping the fleet of 650 planes, 150,000 trucks and 300,000 employees nimble.
“There was a severe ice storm headed for Dallas last year,” Tronsor recalled. “We closed that facility because of that ice storm and we rerouted all of that traffic to Memphis.” The planes could’ve landed in Denver, but icy roads meant thousands of packages would’ve been stranded once on the ground.
The team runs forecasts on each key airport two or three times a day, FedEx meteorology manager Kory Gempler told CNNMoney.
So far, the weather this season has been “fairly tranquil,” said Gempler. But he’s watching a storm that could complicate travel and deliveries on Christmas Eve.
But storms or not, if you haven’t made your purchases at this point, you’re out of luck. Laura Stevens and Suzanne Kapner wrote for The Wall Street Journal that carriers are limiting the number of last-minute shipments this year:
United Parcel Service Inc. and FedEx Corp. started capping air express deliveries in recent days after an 11th-hour increase in packages caused some retailers to exceed agreed-upon limits, according to people briefed on the situation.
This year, both UPS and FedEx held some retailers to their volume commitments during the final shopping days before Christmas, aiming to avoid a repeat of last year’s fiasco. Last Christmas, an estimated 2 million express packages didn’t arrive under the tree in time, according to software tracking developer Shipmatrix Inc.
Tom Barone, the vice president of North American operations for eBay Enterprise, which handles shipping and other logistical issues for close to 100 brands and retailers, said delivery companies had asked Tuesday for his clients to scale back last-minute shopping deals to take some pressure off shipment volumes.
Mr. Barone said most of his clients had already rolled back shipping deadlines to late afternoon on Dec. 23 for delivery by Christmas Eve to minimize missed deliveries. Last year, the cutoff went as late at midnight at some retailers.
Surging online shopping over the holidays fueled by offers of free shipping and deep discounts tests the limits of the infrastructure—planes, trucks and sorting hubs—used to deliver the gifts to tens of millions of homes in neighborhoods from Miami to Seattle.
Last year, UPS was caught flat footed by a surge in deliveries, a limited air fleet and bad weather and had to tell millions of Americans their gifts wouldn’t arrive in time for Christmas. FedEx said it wasn’t affected as badly, apparently because it rejected some last-minute unexpected volume, a demand UPS tried to meet, although it conceded it struggled with the weather.
Here’s hoping the weather holds and that you’ve already finished all your shopping. It’s the busiest one for retailers, shippers and other drivers of the consumer economy. The numbers next year will tell how much lower energy costs and other spending helped the economy.
