FedEx Just Released A New Price And Cost Warning | The Economic Ninja

Hey everybody, economic ninja here. I hope you’re doing well. We’ve got a warning, a fresh warning out of FedEx about price hikes coming. And this is FedEx warning of higher costs under trucker rest break waivers. Now the reason why I’m reporting on it is because as FedEx raises prices, it affects everyone, our entire lives. Yesterday had to ship some documents over to Canada. The FedEx cost was $55 for four documents and went to the US Postal Service and it was about $21.

Big price difference. But here’s the thing, we don’t always use the post office for everything we ship. Obviously FedEx is a major carrier. As a matter of fact, I got to make a phone call to a friend of mine because he believes that UPS has some massive theft ring going on and I want to be able to interview him about that. And they’re switching to FedEx immediately. This announcement just came out today, so I think this is very important news.

Now this story is out of freight waves. It says multiple millions of dollars are at stake if the FMCSA approves hour of service waivers for California. Washington delivery giant says out of Washington, FedEx Corp. Predicts higher costs on its line haul and delivery routes, as well as those rivals if the Biden administration approves waivers governing truck driver meal and rest breaks in California and Washington. In comments filed with the Federal Motor Carrier Safety Administration, FedEx asserts that if the FMCSA were to waive its preemption over the two states meal and rest break laws, which would make interstate carriers subject to the stricter state rules, it will cause financial havoc as well as decreased safety, they say.

State rules on meal periods and rest breaks require FedEx and other transportation companies to revise routes as well as compensation plans and policies at a great operational cost, wrote FedEx corporate vice President Clement Clank. In addition of this break time, some of which is paid increased labor costs to the tune of multiple millions of dollars each year. Moreover, according to Clank, unnecessary but required breaks increase the length of a driver’s workday and their time away from home, having a negative impact on both driver fatigue and driver morale.

If you’re working for FedEx, I’d love or ups, I’d love to hear your comments down below of what you think about these rules. It says here in California, truck drivers must be provided a 30 minutes meal break if they work more than 5 hours in a day, and drivers who work a shift of 10 hours or more are entitled to a second 30 minutes meal break. Drivers are also entitled to a ten minute rest period for each four days that they work in a day.

Washington’s rules are similar. In contrast, the federal break rules require that a truck driver only takes a 30 minutes break after 8 hours of driving time and allow an on duty, non driving period to qualify as a required break. Under pressure to reduce injuries and deaths from crashes involving in heavy trucks, FMSCA in August 2023 notified the trucking industry that it would entertain requests to waive agency decisions made in 2018 and 2020.

That rule ruled federal hours of service rules preempt MRB laws in California and Washington, respectively, for interstate trucking. The two Trump era decisions made in response to petitions filed with the American Trucking association and the Washington Trucking association, determined that MRB rules in those states are more stringent than federal regulations, a criteria that opens the door for federal preemption. In last year’s notice, FMCSA encouraged those requiring a waiver not to argue that the agency’s 2018 and 2020 determinations were wrongly set forth, but rather to show whether interstate drivers in California or Washington still subject to those states.

Look, the reason why I cover this news is because I think it’s very important. Every time we see the opportunity for prices to go up in the institutional level, the corporate level, we know that those price rises are going to hit us all. They’re going to hit our businesses. They’re going to hit our pocketbooks. They’re going to hit everything. And it’s also very important to watch what’s going on between the bankruptcies in the shipping industry and the pricing wars and what’s going on with the prices themselves, because that is going to show you the health or the strength or the weakness of the economy currently and in the future.

I know we have a lot of people that work in the shipping and trucking industry that watch this channel, and that’s why I want to continue to cover this. But it’s very interesting. FedEx is a massive indicator of the economy. And FedEx has been saying, and UpS has been saying, hey, shipping is slowing down, it’s slowing down fast. And that should be showing you what’s going to happen in the future.

Hope you guys got something out of this. Let’s make it short. Sweet. Thank you to everybody that checked the subscription button to see if they got unsubscribed, and to everyone that didn’t, thank you so much for sticking with me. Appreciate it everyone. You are awesome. The economic ninja is out. .

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