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FedEx’s largest delivery contractor makes rare public warning that contractors are going bankrupt so fast the ground delivery network could collapse

  • FedEx’s largest contractor is calling on the company to give contractors a raise by November 25.
  • Spencer Patton told Insider he’s prepared to lose his own business to sound the alarm. 
  • Patton said Wall Street would “panic” if they knew “the degree to which the network is in danger.”

By Emma Cosgrove | 1 August 2022

BUSINESS INSIDER — FedEx’s largest delivery contractor warned on Wednesday that the company’s thousands of contractors are in “dire” financial shape due to rising costs — and without a hike in compensation, the delivery network could fall apart.

Spencer Patton, CEO of Route Consultant, released a video and press release calling for a 50-cent per stop raise for delivery contractors and a 20-cent increase for long-haul trucking contractors by November 25. Patton has a fleet of 275 delivery trucks and 225 employees.

“The FedEx Ground network is in far more peril than what anyone realizes. If Wall Street analysts, if FedEx corporate, and FedEx ground understood the degree to which the network is in danger, there would be widespread panic,” said Patton in the video.

In August, Patton’s company will hold an annual conference in Las Vegas where FedEx Ground contractors will elect a 10-member committee that will attempt to negotiate with FedEx Ground. Patton said this effort is not a union and the committee will decide what to do if FedEx doesn’t act by November 25. […]

3 Comments on FedEx’s largest delivery contractor makes rare public warning that contractors are going bankrupt so fast the ground delivery network could collapse

  1. I could easily see that happening, particularly if diesel continues to rise like it has been. Ground delivery contractors have to work pretty hard to earn their money. And they are small businesses who get no benefits. Just the per package rate they get for delivery.

  2. The collapse should have happened during the COVID lockdowns — instead stupid Americans addicted to discretionary spending ordered their toys and trinkets online, further contributing to the woes of Main St America (‘brick and mortar’ stores).

  3. Diesel is the issue. If FedEx contractors are going under imagine what truckers are doing? Rates in the toilet and $1 per mile to operate diesel prices? With a now slowing global economy? I am amazed nobody talks about trucking and/or diesel prices. Giant elephant in the room.

    And truckers own equipment. Financed. Homes. Financed. Kiss lending the industry goodbye with record defaults if things don’t get fixed soon and no Biden isn’t going to do it an trump isn’t the problem.

    It’s over folks. Just a matter of time now.

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