This week in parcel, UPS and Teamsters are in a stalemate. Is a strike inevitable with two weeks before the current labor contract expires?
Meanwhile, UPS is releasing its midyear earnings report later than it has since going public in 1999, and FedEx attempts to court as many UPS customers as it can handle.
UPS and Teamsters are in a stalemate. Could Amazon be the X factor?
With the UPS/Teamsters negotiation at a standstill, the big question the industry is asking is if a strike is going to happen. Here is our view of what UPS customers should be paying attention to right now.
There are only two weeks left until the current labor agreement between Teamsters and UPS expires, and there is little to be optimistic about.
The two sides walked away from the bargaining table on July 5, and there have been no new discussions since then. Both sides are trying to pin the other side for the collapse in the negotiations.
While Teamsters’ main focus is to get the best possible deal with UPS, it is also looking to attract current Amazon employees.
The combined propulsive force of Teamsters’ desire to flex its negotiation skills to Amazon employees and UPS’s desire to avoid losing customers over the fear of a strike could be the X factor in the negotiations.
Read more here.
UPS releasing midyear earnings later than usual
Since going public in 1999, UPS has not released its financial earnings later than the final week of July. This year, the carrier will release its report on August 8.
This release day is eight days after UPS’s current labor contract expires. UPS did not say whether its negotiations with Teamsters is the reason behind pushing the release of the earnings report back.
If UPS is not able to reach an agreement with the union, a strike on August 1 would halt roughly 19 million packages a day.
Our take: Is this a sign the yet-to-be-announced results will have an impact on the carrier’s position as it relates to the negotiations? Is UPS withholding the midyear earnings report to prevent the union from using it as a bargaining chip?
Read more here.
FedEx prepares for a potential UPS strike
FedEx is preparing for the potential UPS strike by accepting additional parcel volume. The carrier knows it cannot fully absorb UPS’s volume in the event of a strike, but it does look to win over as many customers as possible.
Shippers looking to shift their volume to FedEx will have to do so immediately. FedEx had previously recommended that companies using UPS shift their volume by the end of March to guarantee FedEx would include the added volume in its capacity planning.
If Teamsters members do strike at the beginning of August, other carriers would only be able to pick up an estimated 10% to 20% of UPS’s current volume.
Our take: It’s too late to move a significant volume between carriers to avoid service disruptions caused by a strike, but it might be time to renegotiate. Email info@transimpact.com.
Read more on FedEx’s efforts here.