FedEx rules out more capex, completes AFL, UFL integration

Global logistics major FedEx today said it has fully integrated the AFL and UFL businesses in the country, almost three years after acquiring them, to achieve scale and ruled out making major investments in the near future.
"We have doubled the number of vehicles in the fleet to 1,000, expanded coverage to 19,000 PIN codes from the earlier 4,000 and increased the office and hub space to over 1 million square feet from the earlier 3 lakh square feet," vice president for domestic operations David Canavan told reporters here.
He said the company will not be investing much in the immediate future and will instead focus on leveraging the advantages gained from the integration. Investments in the future will depend on GDP expansion, he said.

Canavan said he is confident that FedEx will grow faster than the industry, although he declined to give details, citing confidentiality concerns on commercial information.
Managing director for marketing Rakesh Shalia said typically, the ground movement industry will grow 15-20 per cent per annum, while air cargo would grow 10-12 per cent in the near future.
The company acquired two domestic market focused companies, AFL and UFL, in 2011 to increase its footprint.
Canavan said the integration of the business, which has created a single unit with over 7,000 employees, did not take too long and stressed that final integration was achieved a few months ahead of schedule.

He declined to answer a question on the medium-to-long-term outlook for the staff, warehousing space and fleet aspects, limiting himself to saying it will not be looking at any major investments now.