Login
or
Register
Home
»
Trains Magazine
»
Forums
»
General Discussion
»
Fedex?
Edit post
Edit your reply below.
Post Body
Enter your post below.
[quote]QUOTE: <i>Originally posted by karen3172</i> <br /><br />If Fedex doesn't ship by rail and does only by truck how do they compete UPS? <br />[/quote] <br /> <br />Unlike FedEx, which has two separate companies in the package business, UPS is one company in both air and ground transportation of packages. <br /> <br />For this reply, lets separate this into air and ground transportation. FedEx Ground, the old "RPS" company verses UPS ground. <br /> <br />FedEx Ground employees are mostly contractors. Route drivers are independent contractors and purchase their routes and trucks from FedEx. As independent contractors for FedEx Ground, the workers, pay all taxes for their Social Security, Medicare, state industrial combinsation, and state disability insurance (where required). For employees, these are mostly divided 50/50, half paid by the employee and the other half paid by the employer. <br /> <br />The FedEx Ground contractor also pays for all insurance on the truck, along with all maintenance costs for the delivery truck. They also bare the major portion of any retirement program and also pay the full cost on medical insurance. <br /> <br />A FedEx Ground delivery driver, with a good route, might gross $100,000 to $120,000 bucks or more, after the above mentioned expenses the net on income could drop to as low as $45,000 to $55,000. A UPS Ground driver nets between $55,000 to $70,000. The same forces apply to line drivers of FedEx Ground, which deliver packages between stations. <br /> <br />Unlike FedEx Ground, UPS workers are all employees of the company, and have always been. They mostly only pay half on the taxes mentioned above. UPS pays all costs of health and welfare, retirement and medical insurance. There is no truck costs paid by UPS Ground employees. <br /> <br />So, with an average wage of over $25 an hour, along with all the associate expenses, a UPS worker earns way over $40 an hour. Because costs of manpower at UPS is much greater than FedEx Ground, rail has for a long time always figured into UPS's business model. <br /> <br />Because FedEx Ground employees are contractors, and the cost to the company is so much less than UPS employees, there is no need to really include rail in the business plan, except when seasonal demand out-strips capacity. <br /> <br />FedEx ground competes with UPS mostly without intermodal rail because in relationship with UPS, workers at FedEX Ground work so much cheaper. This allows FedEx to keep its package business mostly on the highways. <br /> <br />Again, I know very lttle about the package business, except what I read.
Tags (Optional)
Tags are keywords that get attached to your post. They are used to categorize your submission and make it easier to search for. To add tags to your post type a tag into the box below and click the "Add Tag" button.
Add Tag
Update Reply
Join our Community!
Our community is
FREE
to join. To participate you must either login or register for an account.
Login »
Register »
Search the Community
Newsletter Sign-Up
By signing up you may also receive occasional reader surveys and special offers from Trains magazine.Please view our
privacy policy
More great sites from Kalmbach Media
Terms Of Use
|
Privacy Policy
|
Copyright Policy