Is FedEx losing its luster in the package delivery field?

Recently, it’s fallen behind even the USPS in on-time delivery performance.

FedEx’s 2021 YTD delivery performance hasn’t exactly been stellar.

The pandemic-fueled increase of online product ordering hasn’t let up in recent months.  And the tale it tells is FedEx struggling to keep up with its rivals when it comes to on-time parcel deliveries.

The most recent statistics covering March through mid-April show a significant difference in delivery performance – 87% on-time deliveries for FedEx Ground shipments compared to 95% in the case of UPS.  Those figures come from ShipMatrix, Inc., a company that tracks shipping and delivery performance.

According to The Wall Street Journal, the comparatively weak performance by FedEx elicited this anodyne statement from a company spokesperson:

“FedEx continues to experience a peak-like surge in package volume due to the explosive growth of e-commerce.  As always, we are working closely with our customers to manage their volume and identify opportunities to help ensure the best possible service.”

… As if the other delivery companies aren’t facing the same dynamics regarding the growth in online ordering volume.

Delivery tracking software company Convey has released figures that are even more problematic for FedEx.  In April, only around 70% of FedEx shipments were on-time, which means the company’s performance was weaker than UPS and even the U.S. Postal Service. 

In response, FedEx claims that Convey’s data haven’t aligned with its own internal stats, but the company hasn’t released figures of its own to illustrate the difference.

At the same time, FedEx reports that it’s doubling down on plans to increase its network capacity, along with recruiting additional workers.  Even so, it acknowledges that FedEx Ground capacity will continue to be constrained until the end of 2021.

Up to now, the unimpressive record on parcel deliveries hasn’t appeared to hurt FedEx’s financials, which recently hit their highest-ever monthly revenue and operating profit levels.  The question is, can that performance hold long-term if businesses and their customers continue to experience slower deliveries?  It isn’t as if there aren’t alternative suppliers in the parcel delivery business.

Have you experienced issues with FedEx’s delivery performance recently?  If so, are they significant enough to make you open to considering alternative shippers?  Please share your thoughts with other readers here.