The slowdown in global economic growth is taking a toll on FedEx Corp. (NYSE: FDX) and the company today announced a move to try to cut expenses. The company will offer voluntary buyout incentives to some U.S.-based employees “as part of a broader plan to improve efficiencies and reduce costs.” The targeted employees come mostly from “non-operational staff groups,” according to the FedEx press release.
The company is currently figuring out which employees will be eligible for the buyouts, but it did note that “employees who are eligible for this program and are also eligible to retire may elect to accept the buyout and also retire.” The company expects to announce details by the fourth quarter of its 2013 fiscal year, which ends next May.
Both FedEx and rival United Parcel Service Inc. (NYSE: UPS) have seen share prices appreciate this year, but UPS’s gain is nearly double FedEx’s. Yet both shippers’ stock prices peaked in March and have come down about 10% as the global economy staggers along. Unlike UPS, FedEx did not cut profit estimates for this fiscal year, but did say that it would cut costs in order to maintain modest growth. Today’s announcement is likely just the first of the cost-cutting measures.
Shares of FedEx are inactive in the premarket this morning. The stock closed at $87.80 on Friday, in a 52-week range of $64.07 to $97.19.