New YorkCNN Business —
FedEx’s Ground service will stop making Sunday deliveries to about 15% of the US homes in rural areas that it’s currently serving.
The change will take place Sunday, August 21, FedEx (FDX) announced Friday.
During the pandemic the company had expanded Sunday service to 95% of US homes, a response to “the exponential growth of e-commerce,” FedEx said in a statement. But “as economic conditions have shifted,” it’s scaling the service back to 80% of homes.
FedEx Ground handles the majority of the company’s online purchase shipments business, but it’s a crowded field with competition from Amazon (AMZN)’s own in-house delivery service, the US Postal Service and UPS (UPS).
Even before Friday’s announcement, FedEx Ground had already been trimming some of the lower-priced, less time-sensitive “economy” shipments to homes.
Despite the challenges for that line of business and a drop in the number of shipments at FedEx Ground, the unit’s sales were up in the most recent quarter — thanks largely to charging shippers an additional fee for fuel. Most other trucking companies have also introduced fuel surcharges because of record-high diesel costs.
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