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Jim Hatley, FedEx managing director for Alaska operations, said Aug. 28 that FedEx will buy the very first Airbus 380 cargo jet, and plans to add three of the giant aircraft to its fleet in 2008 or 2009. "We've already got plans on how they will park here," Hatley said. "The plan on the board right now is for them to come and land here." Shipping everything from panda bears to race cars and walruses, Federal Express is the largest cargo carrier at Anchorage International with 10 jet gates and an average of 15 heavy jet flights a day. FedEx handles daily flights from Tokyo, Taipei, Hong Kong and the Philippines, and business is growing in China and Korea.
"The focus is on developing more business in Anchorage and Alaska," Hatley said. "From a sales perspective and an operational perspective." Anchorage is the Pacific hub for FedEx, and adding the A380s to the fleet does not mean that FedEx will overfly Anchorage. Anchorage is the second largest international hub in the FedEx system. And like other cargo carriers here, FedEx will keep taking advantage of the logistical benefits of Anchorage as an international cargo crossroad. Anchorage, for example, features leading freight forwarders and is equidistant to major cities in the Northern hemisphere. "It's very critical, because of the distances," Hatley said. "We can refuel here, sort here, carry larger payloads and reduce the number of flights." FedEx already has made $200 million in capital investments in Alaska and intends to expand its facilities and workforce at Anchorage. The expansion plans, however, are on temporary hold, pending increased trade between the United States and Asia. Hatley did not say how large any new buildings would be, or project the enlarged workforce, but did say that by 2005 and 2006, the company will start construction to increase its sorting capacity and current warehouse space of 302,065 square feet. When complete, by 2008, the expansion will allow the cargo giant to sort 16,000 pieces an hour, double the current capacity. The expansion also should mean an increase in employees. Currently, FedEx has about 102 flight crew members residing in Anchorage, "and more and more are moving here all the time," Hatley said. According to airport documents, FedEx generated 8.5 percent of total revenue at Ted Stevens Airport ($4.3 million, including $1.3 million in landing fees) and accounted for 4.6 percent of total airport landings in fiscal 2002. For fiscal 2002, FedEx spent $80 million on fuel purchases in Alaska, according to company documents. It also made vendor payments of $38 million. Kevin Pearson, vice president of business development for the Anchorage Economic Development Corporation, called FedEx a major player in the Alaska economy with its workforce of 1,325 people and a $52 million payroll. "The ripple effect of that payroll is a real economic engine," Pearson said. FedEx offers its part-time student workers a tuition refund program of $3,500 per year and even provides some classes at the airport. FedEx ranks 7th among Alaska's private employers and is the 8th most admired U.S. company, according to Fortune magazine. Michael Kean, transportation director of the AEDC, said 66 percent of revenue at Ted Stevens Airport is generated by cargo operations. "FedEx and UPS are both here because we are the center of everywhere in the commercial global distribution area," Kean said. Last year FedEx had a growth rate of about 3-4 percent in the Lower 48, Hatley said. While business has been somewhat flat internationally in Europe and Latin America, there is significant growth in China and Korea due to manufacturing and cheaper labor in those regions. In 1971 FedEx was the largest business startup in U.S. history with an $80 million outlay. In 1983 it was the first corporation to grow to $1 billion in sales without an acquisition and in 1990 it was the first service company to win the Malcolm Baldrige national quality award. Today, FedEx owns the world's second largest air fleet and operates the world's largest fleet of wide-body aircraft (225), connecting to 215 countries worldwide. Revenue for 2003 was $22.5 billion with more than 219,000 employees, a ground fleet of 70,000 vehicles and an air fleet of 643 aircraft. Average daily transactions include more than two million tracking requests and 500,000 shipping transactions. Air hubs in the U.S. are the FedEx superhub at company headquarters in Memphis, Anchorage, Fort Worth, Indianapolis, Newark and Oakland. Other hubs are Toronto, Paris, Subic Bay in the Philippines and Miami. In 2003 FedEx was named Wal-Mart carrier of the year. The company has an enormous gas bill. Last year FedEx spent $1.2 billion in fuel costs companywide, an increase of 22 percent over the previous year.
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