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Consortium NewsNov 25, 2022
FedEx Warns of Global Recession, Slashes Forecast by 500M
story
Image copyright: Getty Images [via Yahoo! Finance]
The Facts
FedEx stocks dropped steeply on Friday and the shipping company warned of a global recession as demand for packages has plunged worldwide. On Thursday, FedEx warned that a slowing economy - especially in Asia and Europe - has prompted the company to reduce revenue projections by $500M.
The analysis from the US-based firm aligned with outlooks from fellow logistics companies including Hong Kong-based Pacific Airways and French-based CMA CGM in suggesting that consumers are saving for gas and food instead of casual shopping.
The Spin
Establishment-critical narrative
The volatility of the COVID pandemic and rampant inflation exposed deep structural issues at FedEx and in the logistics industry. The "essential workers" are independent contractors who suffer brutal conditions, long hours, and unacceptably low compensation. There must be labor solidarity to advocate for better pay, improved health and safety, and perhaps the legal protections of being a "franchisee" of the struggling shipping giant.
Pro-establishment narrative
The gloomy forecast from FedEx is indeed staggering, but it's due to a failure to cut costs, rather than "big picture" global economic trends. FedEx is finally trimming expenses by closing offices and freezing new hires. The company needs to improve its agility first, then its performance can be discussed in the context of the logistics industry and global economy.
