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FedEx Corp (NYSE: FDX) said it is suspending Sunday delivery operations in some low-density, rural US markets starting from August 15 to increase the efficiency of its Ground unit.
The delivery giant is optimizing its delivery network based on market conditions and customer needs, the company said in an emailed statement to Reuters.
FedEx’s Ground unit, which handles the bulk of the company’s e-commerce home deliveries, will cut down its coverage to about 80% of the population from 95%.
The company had started Sunday deliveries to match the e-commerce boom after the COVID-19 pandemic struck in early 2020.
“We accelerated the rollout of Sunday residential delivery coverage to nearly 95% of the US population,” FedEx said. “As economic conditions have shifted, we are making operational adjustments to suspend Sunday delivery operations in certain low-density, rural markets.”
FedEx did not clarify the specific markets that would be affected by the new policy.
The move comes as the company deals with cooling demand, and the 6,000 small companies that deliver packages for the Ground unit have been complaining that they’re losing money because of rising costs.
Picture Credit: CNBC
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