FedEx contractor revolt?

[It will be fine]

If the great ponderous heads who are experts at predicting economic cycles believe that there will be a prolonged downturn, then FedEx would be OK with contractors walking away.

In the meantime, contingency buzzards will fill the gaps. For the contractors that remain, maybe FedEx will try to force abandoned areas upon contractors as a condition of renewing their contract.

I've read that contingency contractors make bank. I also heard Patton claim that he would no longer fill contingency routes. But it wouldn't surprise me if he would encourage a large contractor exodus, and fill those contingency routes under a new or different entity.

It wouldn't be the first time a successful businessman said one thing, and did something else.

They are making scale within a building minuscule. There’s a contract split here that needed special approval to go through. It was barely above 1000 stops/day average. That scale is way too small to afford all the admin work required to run these businesses. FedEx wants smaller contractors, they won’t force the remaining ones to get bigger leaving larger holes when they walk.

 

[yadig]

They are making scale within a building minuscule. There’s a contract split here that needed special approval to go through. It was barely above 1000 stops/day average. That scale is way too small to afford all the admin work required to run these businesses. FedEx wants smaller contractors, they won’t force the remaining ones to get bigger leaving larger holes when they walk.

FedEx is a control freak kinda company and it will be their downfall with ground.

 

[It will be fine]

FedEx is a control freak kinda company and it will be their downfall with ground.

Agreed. The strength of a contractor model is the dynamic creative nature of contractors. They are destroying that with no tangible benefit.

 

[Cactus]

FedEx is a control freak kinda company and it will be their downfall with ground.

And Express too.

 

[Mutineer]

Thank you for supporting my position when I said earlier that FDX could tie an abandoned work area to a contractor with an adjoining area making accepting that abandoned area a condition for acquiring a new contract. Believe me, doing something like that is well within their past practices.

When it comes to creating new ways to shaft people, there is no low where FedEx wouldn't stoop. Everything is within the realm of possibility.

Another good point you made is concerns regarding the real intent of Spence Patton. He plainly stated that he was looking out first and foremost for #1. It perplexes me as to why contractors are pinning so much hope that a single contractor will be able to improve their lot. Perhaps this guy really does represent contractors last best hope of reacquiring economic viability.

If Patton can convince 1/4 of contractors to tell their drivers to take a day off, the immediate fallout on FedEx's reputation and stock prices would be significant.

They are making scale within a building minuscule. There’s a contract split here that needed special approval to go through. It was barely above 1000 stops/day average. That scale is way too small to afford all the admin work required to run these businesses. FedEx wants smaller contractors, they won’t force the remaining ones to get bigger leaving larger holes when they walk.

I had forgotten that detail. But FedEx is going to have to convince or force somebody to take the abandoned, crappy routes. It may boil down to contractors uniting and creating ways to make the work environment "uncomfortable" for contingency contractors.

 

[zeev]

Kevin Rutherford on Trucking Tribe is talking about FedEx Ground right now.

 

[CookiePuss]

I knew this would get interesting!

FedEx files lawsuit against its largest contractor over holiday peak shipping

A Black Friday battle is intensifying between FedEx and a key contractor issuing a holiday-peak ultimatum. CNBC's Frank Holland joins 'Squawk Box' with the details.

www.cnbc.com

 

[zeev]

I knew this would get interesting!

FedEx files lawsuit against its largest contractor over holiday peak shipping

A Black Friday battle is intensifying between FedEx and a key contractor issuing a holiday-peak ultimatum. CNBC's Frank Holland joins 'Squawk Box' with the details.

www.cnbc.com

FedEx just destroyed the value of the routes in the FedEx Ground system, also John Smith, a real Boss Hogg

 

[bbsam]

FedEx just destroyed the value of the routes in the FedEx Ground system, also John Smith, a real Boss Hogg

There’s been zero value in the routes for quite a while. That’s why they’ve had open areas for years.

Smith is really doing FedEx no favors. He’s looking like an out of touch buffoon of a CEO. The lawsuit references misinformation which would be fascinating to see both sides put their sets of “facts” on the table.

So if you’re in charge of shipping for Walmart, Target, etc. and you see Smith on this TV interview, what do you think? Do you believe Smith?

 

[bacha29]

I knew this would get interesting!

FedEx files lawsuit against its largest contractor over holiday peak shipping

A Black Friday battle is intensifying between FedEx and a key contractor issuing a holiday-peak ultimatum. CNBC's Frank Holland joins 'Squawk Box' with the details.

www.cnbc.com

Finally the first shot across the bow. Again it comes down to some indisputable facts:

1. Contractors hung around too long. Contract flippers and speculators were coming from all directions offering ridiculous sums
of money for routes. Smart contractors took the cash and walked away laughing over their shoulders. The not so smart ones,
and the ones with big egos, well,.....they're just walking away.

2. Patton and contractors like him got too big, too unwieldy, too leveraged to easily and quickly downsize leaving them even
more subjugated to the absolute power of FDX.

3.. As we discussed earlier, the only thing that matters is what Patton can win in the courts. FDX knows that and got the jump on
him. So now he's working from an even bigger disadvantage.

4. Once again it would appear that Patton forgot who's rights he's hauling under and who owns the only freight he has to haul.
And in light of the lawsuit that has been filed against him, I wouldn't be surprised if his access to borrowing sources at
least for the most part have disappeared.

 

[Fred's Myth]

There’s been zero value in the routes for quite a while. That’s why they’ve had open areas for years.

Smith is really doing FedEx no favors. He’s looking like an out of touch buffoon of a CEO. The lawsuit references misinformation which would be fascinating to see both sides put their sets of “facts” on the table.

So if you’re in charge of shipping for Walmart, Target, etc. and you see Smith on this TV interview, what do you think? Do you believe Smith?

Boss Hogg was an accurate description.

 

[bbsam]

Finally the first shot across the bow. Again it comes down to some indisputable facts:

1. Contractors hung around too long. Contract flippers and speculators were coming from all directions offering ridiculous sums
of money for routes. Smart contractors took the cash and walked away laughing over their shoulders. The not so smart ones,
and the ones with big egos, well,.....they're just walking away.

2. Patton and contractors like him got too big, too unwieldy, too leveraged to easily and quickly downsize leaving them even
more subjugated to the absolute power of FDX.

3.. As we discussed earlier, the only thing that matters is what Patton can win in the courts. FDX knows that and got the jump on
him. So now he's working from an even bigger disadvantage.

4. Once again it would appear that Patton forgot who's rights he's hauling under and who owns the only freight he has to haul.
And in light of the lawsuit that has been filed against him, I wouldn't be surprised if his access to borrowing sources at
least for the most part have disappeared.

I don’t know if the lawsuit has any merit. By the agreement that FedEx drew up, these disputes go to mediation. This looks like a media stunt and all the “misinformation” being put on a judges desk won’t look god for FedEx.

 

[instiches]

I don’t know if the lawsuit has any merit. By the agreement that FedEx drew up, these disputes go to mediation. This looks like a media stunt and all the “misinformation” being put on a judges desk won’t look god for FedEx.

Assuming they sued Route Consultant, they wouldn't be limited to mediation because it's not within the scope of the Agreement.

 

[bbsam]

G

Assuming they sued Route Consultant, they wouldn't be limited to mediation because it's not within the scope of the Agreement.

Good point

Information I’ve seen from RC is accurate

 

[fedx]

Agreed. The strength of a contractor model is the dynamic creative nature of contractors. They are destroying that with no tangible benefit.

Like I said before, FedEx treats Ground like hourly employees with none of the benefits for those employees. You're driving FedEx livery vehicles, you wear FedEx uniforms, you follow all their rules they dictate. However, you get no 401K or pension, you get no FedEx insurance benefits, you get no PTO from FedEx. You do all the work of hourly employees with none of the benefits.

 

[bacha29]

I don’t know if the lawsuit has any merit. By the agreement that FedEx drew up, these disputes go to mediation. This looks like a media stunt and all the “misinformation” being put on a judges desk won’t look god for FedEx.

We'll have to wait to see if the courts rule that the suit has standing ,then go from there. If FDX has asked for an expedited ruling that might favor Patton.

 

[Mutineer]

I knew this would get interesting!

FedEx files lawsuit against its largest contractor over holiday peak shipping

A Black Friday battle is intensifying between FedEx and a key contractor issuing a holiday-peak ultimatum. CNBC's Frank Holland joins 'Squawk Box' with the details.

www.cnbc.com

@00:49, Smith sez something like: "we are ready with our contingencies."

Smith's statement reminds me very much of a scene from a documentary re-enacting a famous medieval battle.

A know-nothing royal figure of a side that is losing the battle states confidently to his commanders "that the conscripts are ready."

It goes downhill quickly for them from there.

 

[Mutineer]

4. Once again it would appear that Patton forgot who's rights he's hauling under and who owns the only freight he has to haul.
And in light of the lawsuit that has been filed against him, I wouldn't be surprised if his access to borrowing sources at
least for the most part have disappeared.

That's fine. And FedEx can fill the empty ranks with conscripts. Er, I mean contingencies.

Whether they fail or bail, if that happens too many times, FedEx will be begging and bribing congress-critters for "labor relief".

They can send illegal immigrants, National Guardsman, and prisoners to schlep boxes in delivery vans composed of vapor.

 

[Aquaman]

We'll have to wait to see if the courts rule that the suit has standing ,then go from there. If FDX has asked for an expedited ruling that might favor Patton.

Suing this guy is going to do nothing but throw gas on the fire. This is the dumbest company of this size in the world…

 

[It will be fine]

FedEx just pulled Spencer’s contracts. 225 drivers just got fired because John Smith got his feelings hurt.