FedEx, Amazon and UPS are cutting costs due to declining demand
FedEx, Amazon and UPS have all announced notable cost-cutting moves in response to declining customer demand in recent months.
FedEx has resorted to a combination of layoffs, furloughs and consolidating operations among various areas to potentially save billions of dollars in fiscal year 2023.
Amazon earlier this year announced a significant number of layoffs while also halting some projects due to low volume.
The last of three companies to announce staff reductions was UPS, with the company giving a glimpse into its plans in February.
Here are some of the changes FedEx, Amazon and UPS have made in adjusting to the current economic conditions.
FedEx plans to save more than $3.7 billion in 2023
After disappointing first and second quarter earnings reports, FedEx plans to cut more than $3.7 billion this fiscal year. The moves come as a response to low demand and higher operating costs.
Two of the Memphis-based company’s most recent cost-cutting moves include laying off more than 10% of the officer and director team and FedEx Freight announcing a second round of furloughs in February.
Amazon deals with layoffs, warehouse construction slowing down
Amazon announced in January plans to cut about 18,000 positions. It was largest set of layoffs in the Seattle-based company’s history. The company has a workforce of 1.5 million.
Amazon has also reduced warehouse capacity over recent months by subleasing some of its warehouses and delaying or canceling construction on others.
UPS announces recent staffing reductions
UPS in an email to The USA TODAY Network confirmed plans to reduce staffing in areas throughout the country with lower customer demand.
“Similar to how our network flexes throughout the year to meet seasonal customer demand, we are reassigning some of our employees to meet the needs of our business,” a UPS spokesperson said via email.
“This is not nationwide, but only in select parts of the country, in response to uneven demand. We are hopeful that our people will be able to return to their previous positions later this year. Taking these steps now helps us to be a stronger company for our employees and our customers.”
The Associated Press contributed to this report.