FedEx Express has announced that it has permanently retired another 22 of its Boeing 757-200 freighters as the carrier continues to manage its fleet resources. The announcement came on June 25, 2024, as the Memphis-based shipping and logistics company revealed its financial results for the quarter ending May 31, 2024.
The company reported fiscal fourth-quarter revenues of $201 million, compared with $430 million during the same period in 2023, resulting in a year-on-year decrease of 53%.
“Fourth quarter results include a non-cash impairment charge of $157 million from the decision to permanently retire 22 Boeing 757-200 aircraft and seven related engines as the company continues to modernize its fleet, improve its global network efficiency, and better align air network capacity with current and anticipated demand,” the firm reported.
The 757s have formed the backbone of the all-cargo airline’s operations across North America (as well as on some international routes) since the type replaced Boeing 727s, of which the carrier once operated around 180 aircraft. According to ch-aviation, FedEx now has a fleet of 109 757-200s in its fleet, with 57 showing as active while 52 are described as inactive. Many of the airframes still flying are well over 30 years of age.
The decision was made alongside the closure of seven FedEx facilities to better “match capacity with demand,” the corporation said.
The company blamed lower international cargo yields as the primary driver of the decreased financial performance of FedEx Express over the past year. Equally, the company has struggled since the end of the pandemic in which it thrived.
As more passenger aircraft have returned to the global fleet of aircraft offering more belly-hold space to freight forwarders, cargo airlines have seen demand for their services fluctuate hugely. FedEx has been one of several freight-only airlines reviewing pilot contracts and decreasing fleet sizes amid the shifting landscape of air cargo markets.
Adding to FedEx’s challenges, at the start of 2024, rival company United Parcel Service (UPS) secured the lucrative contract to become the primary air cargo carrier for the US Postal Service (USPS), a contract that FedEx had held for the past two decades. This is thought to be another contributing factor to the retirement of the 757s from the FedEx fleet.
The company is forecasting revenues of $5.2 billion for fiscal 2025, “with a priority on investments in network optimization and efficiency improvement, including fleet and facility modernization and automation”.