Having an app doesn't give Uber a delivery advantage over FedEx

The market for delivering goods locally in a few hours is small, said FedEx's CEO

FedEx isn't worried about car-hailing startups encroaching on the parcel delivery business.

There's always been a market for same-day delivery services offered by taxi companies, courier services and now Uber, said FedEx CEO Fred Smith.

"Great company, great concept, but I don't think it's likely to be a major player in the logistics business," said Smith during an earnings call Wednesday.

Having an app doesn't give a company an advantage in handling the logistics associated with a major shipping operation.

"I think there's just an urban mythology out there that the app somehow changes the basic cost input of the logistics business or changes the Circadian patterns or the underlying business situation," he said, adding that he uses Uber.

The market for delivering goods locally in a few hours is "much smaller" compared to the greater global delivery industry, Smith said. Also, the hours that Uber drivers work may not line up with online shopping patterns, he added.

"A huge part of the e-commerce marketplace, for instance, are orders that are processed after 8 p.m. in the evening until midnight," said Smith, implying that Uber drivers could be sleeping when these transactions are occurring.

Ride-hailing apps have expanded beyond transporting people and are starting to deliver goods. Last April, Uber launched its UberRush courier service for package delivery in parts of New York City. In February, Sidecar expanded its same-day delivery service to all the U.S. cities it operates in after testing the feature in San Francisco.

Same-day deliveries will account for half of Sidecar's business this year, the company said. Same-day deliver already constitutes around 10 percent of Sidecar's ride volume in San Francisco, the startup said.

Ride-hailing startups aren't the only technology companies exploring the quick-delivery industry. Amazon and Google offer similar services in several U.S. cities.

During the FedEx call, Smith noted that the company offers a same-day package delivery service in 23 markets.

Fred O'Connor writes about IT careers and health IT for The IDG News Service. Follow Fred on Twitter at @fredjoconnor. Fred's e-mail address is fred_o'connor@idg.com

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags mobilemobile applicationsFedExUber

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Fred O'Connor

IDG News Service
Show Comments

Cool Tech

Toys for Boys

Family Friendly

Stocking Stuffer

SmartLens - Clip on Phone Camera Lens Set of 3

Learn more >

Christmas Gift Guide

Click for more ›

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Michael Hargreaves

Microsoft Office 365/Dell XPS 15 2-in-1

I’d recommend a Dell XPS 15 2-in-1 and the new Windows 10 to anyone who needs to get serious work done (before you kick back on your couch with your favourite Netflix show.)

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Cathy Giles

Brother MFC-L8900CDW

The Brother MFC-L8900CDW is an absolute stand out. I struggle to fault it.

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Laura Johnston

MSI GS65 Stealth Thin

If you can afford the price tag, it is well worth the money. It out performs any other laptop I have tried for gaming, and the transportable design and incredible display also make it ideal for work.

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?