‘Significant’ Goods Were Moved Into US Q4 to Beat Tariff Hike, Says FedEx CEO

FedEx experienced “a significant amount of traffic that was put on the water” beginning in late summer as importers tried to beat the Jan. 1 increase in the List 3 Section 301 tariffs on Chinese goods, said CEO Fred Smith on a fiscal Q3 call Tuesday. Smith’s account squares with recent National Retail Federation reports of busy Q4 import activity at major U.S. container ports (see 1812070026). Though President Donald Trump postponed the increase to March 1 and delayed it again indefinitely (see 1902250001), “there was a lot of inventory that was moved into the U.S." in calendar Q4 and a subsequent slowdown in calendar Q1, he said. “So hopefully now with the anticipation of a trade deal,” said Smith, “maybe we'll go back into a more normal cycle.” FedEx estimates U.S. e-commerce numbers about 50 million packages in “average daily volume,” and forecasts that will double to 100 million by 2026, said Brie Carere, chief marketing and communications officer. “We expect one in four incremental e-commerce packages to be locally fulfilled between now and 2026,” she said. “Innovations” like the robotic FedEx SameDay Bot, unveiled last month, and the new FedEx Extra Hours program will help meet the trend, she said. Hours “enables merchants to fulfill locally as late as midnight while enabling their customers to shop in the evening with next-day or two-day delivery,” she said.