Shares of FedEx Corp. (FDX) surged 3.6% in afternoon trading Friday, swinging from an earlier loss of as much as 1.5%, after the package delivery company said that beginning in March, FedEx's Express business will contract with its Ground business for select, "day-definite" residential deliveries. The move is aimed at increasing efficiencies and lower costs of residential deliveries, as it will reduce the number of delivery vehicles in residential neighborhoods, as e-commerce continues to grow at an "explosive" rate. "This move makes residential deliveries more efficient by putting the right package in the right network at the right cost to serve our customers," said Chief Operating Officer Raj Subramaniam. Last month, e-commerce giant Amazon.com Inc. (AMZN) told its third-party merchants they can resume use of FedEx's Ground network ( ), about a month after banning its use given the failure to meet on-time delivery standards. FedEx's stock has lost 15.1% over the past 12 months while shares of rival United Parcel Service Inc. (UPS) have slipped 3.1% and Amazon's stock has run up 28.7%. In comparison, the Dow Jones Transportation Average has gained 6.3% the past year and the Dow Jones Industrial Average has advanced 15.6%.
-Tomi Kilgore; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
February 07, 2020 14:09 ET (19:09 GMT)
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