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FedEx Corp (NYSE:FDX) is set to offer details on its plans to reduce costs by billions of dollars in a DRIVE Program Update on Wednesday.
The program is aimed to cut $4B by the close of 2025 and is a key focus for Raj Subramaniam, who acceded to the role of CEO in 2022.
“We are right sizing our cost base to match today’s realities and creating a more efficient and agile network,” Subramaniam told analysts in March. “We’re not simply taking out cost, we are simultaneously focused on running our business more efficiently, flexibly and profitably, which will create significant value for our stockholders in the years to come.”
He added that the company had achieved $1.2B in year-over-year cost savings in the third fiscal quarter and remained on track to generate permanent savings of $1B in accordance with the DRIVE plan. These cuts include parking planes, capacity management in the Express business, cutting back on weekend deliveries, worker furloughs and, of course, layoffs.
“Think about DRIVE as the framework of how we approach the business and running a more flexible and efficient operation across the board… if you think about the structural cost reductions, that’s operative irrespective of the demand environment,” CFO Mike Lenz told analysts in mid-March. “So think of that as moving the same traffic with less assets and resources. So, we look forward to giving further updates on the progress and details of the various domains within DRIVE on April 5th.”
The event is due to begin at 8:30 ET.
Read more on recent analyst upgrades fielded by the Memphis-based transportation giant.
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