FDX moving ahead with E-Commerce. Note that last paragraph. As we have previously discussed, FDX is not making a big push into the residential delivery market. They are focusing on the business and information side.
Wednesday August 25, 2:46 am Eastern Time
FedEx pins hopes on Asia and e-commerce
HONG KONG, Aug 25 (Reuters) - Federal Express Corp (NYSE:FDX - news) said it expects Asia to pass Europe in e-commerce in the next three years, fuelling FedEx's growth in the process.
''Many project that Asia will be the number two in the world of e-commerce by 2002, leaping ahead of Western Europe. I believe that that will be the case,'' FedEx Asia-Pacific President Michael Ducker told a breakfast briefing. Asia would ultimately challenge the U.S. for top spot, he said.
FedEx expected to benefit from increased high-technology manufacturing capacity in China's Guangdong province to meet e-commerce orders from retailers in Europe and the United States.
''We have a lot of expectations and hopes for China in terms of e-commerce,'' said David Edmonds, corporate vice president, worldwide services, with FDX Corp, FedEx's parent.
Edmonds said FedEx had an edge over rivals like United Parcel Service [UPS.CN] in terms of access to China, referring to the U.S. Transportation Department decision this month to award it six more flights to China. He predicted it would operate a service to Shenzhen by the end of the year.
Asia was an increasingly important link in the new supply chain as e-commerce increased in importance.
''We're seeing a change in the whole supply chain model...We think the supply chain starts in Asia. The manufacturing of both high-technology and textiles is rampant here,'' said Edmonds, in town to attend the TransAsia 99 logistics trade show.
Edmonds said many of FedEx's U.S. customers were slow to adapt to e-commerce, relying on large inventories instead of ordering stock as it was sold.
''You've got to be nimble. You've got to be fast. You've got to be able to respond quickly. You've got to have a zero-inventory mentality,'' he said.
Ducker said e-commerce in Hong Kong last year was estimated to be worth US$32 million, and was forecast to rise to US$1 billion in 2001.
He said e-commerce in Japan was estimated to total US$1.5 billion last year. ''By 2002 (it's) projected to be US$26 billion. Those are staggering numbers,'' Ducker said.
Edmonds quoted one U.S. estimate that by 2003 US$1 trillion would be traded in e-commerce. ''A lot of this is going to be express-related transportation due to the zero-inventory principles,'' he said.
|
