FedEx Begins Carrying Mail for Postal Service

Associated Press

— FedEx goes to work for Uncle Sam tonight.

The Memphis-based company is launching the air-transport portion of its $7.2 billion contract with the U.S. Postal Service to carry — and sometimes sort — Express, Priority and first-class mail.

The Postal Service expects to save about $1 billion in air transportation costs while extending the delivery area for its next-day Express Mail and two-day Priority services.

FedEx Corp., a $20 billion global transportation company, is trying not to make a big deal of it. Trish Harwood, a company spokeswoman, said today should be “business as usual.” But the contract will mean up to 3.3 million pounds of mail carried on FedEx planes every day. Most of the mail will come through the company’s hub at Memphis International Airport. FedEx has hired nearly 500 pilots, 250 aircraft mechanics and 1,200 cargo handlers to deal with the $6.3 billion air-transport phase of the seven-year contract, which was announced in January.

The first part, valued at $900 million, began in March, when FedEx started installing self-service drop-boxes at post offices nationwide. By next year, 10,000 boxes should be in place.

FedEx has been working with the Postal Service on the air-transport system since June, training the agency’s employees how to fill containers to be placed on FedEx’s aircraft. In recent weeks, FedEx has carried USPS shipments on selected routes as a test of the system.

“So it is not that they are going to start — bang — on Monday with everything never having done it before,” said Satish Jindel, principal of SJ Consulting Group in Pittsburgh.

David Webb, president of the FedEx Pilots Association, the union representing the carrier’s 3,800 pilots, said he doesn’t believe anything will go wrong with the Postal Service contract initially. But he said the holiday shipping season will be “more challenging than any that FedEx has seen before