FedEx & UPS give peak day package forecasts

FedEx expects 11.3 million packages to move through its FedEx Express and FedEx Ground networks on Dec 17, compared with an average daily volume of 7 million packages, the company said in a press release.

Last year, FedEx predicted 9.8 million packages would pass through its network on its peak day.

Spokesman Howard Clabo said last year’s figure did not include FedEx SmartPost packages — a lower cost service in which packages are dropped off at the nearest post office and then taken the last few miles to customers by the U.S. Postal Service.

Excluding SmartPost packages from this year’s prediction, the comparable forecast would be 10.4 million, a gain of 6.1 percent.

UPS spokesman Norman Black said the Atlanta-based company expects package volumes in its network to reach 22 million on its peak day on Dec. 19.

On average day the world’s largest package delivery company moves around 15 million packages through its network.

Company officials said in early 2007 that during the 2006 peak season the company moved more than 22 million packages on three separate days.

Both companies have warned recently that slowing U.S. economic growth will have an impact on their business.

In September FedEx reported a 4 percent increase in fiscal first-quarter profit but warned that slower growth would act as a drag on earnings in coming quarters.

In a conference call with analysts last week after it also posted a 4 percent increase in quarterly net profit, UPS officials said the company still expects package growth in the crucial fourth quarter but added that growth would be slower than in the past four years.

As in previous years, online retail sales are expected to be a boost for both package delivery companies.

Retail consultant TNS Retail Forward predicted in September that fourth-quarter online sales this year would grow 20 percent to USD 42 billion from USD 35 billion in 2006.

Overall retail sales should grow by just 3.3 percent as the credit crunch is expected to hurt consumer confidence, TNS Retail Forward said.