FedEx to see lower earnings due to halted ‘de minimis’ levies

FedEx to face a rough quarter: US-based logistics giant FedEx is set to register an unspecified earnings drop this upcoming quarter after the US move to end the de-minimis rule — a duty exemption on packages entering the US worth USD 800 or less, Reuters reports, citing unnamed analysts. The firm’s CFO, John Dietrich, forecasted a nearly USD 170 mn drop in earnings for its last fiscal quarter — representing almost 0.8% of their overall revenue.

DATA POINT- China and Hong Kong account for some 75% of the small parcels arriving in the US under the de-minimis rule.

REFRESHER- The US ended its de-minimis rule starting 29 August, forcing at least 30countries to suspend parcel freight into the US. Parcel shipments to the country reportedly dropped by 80% in early September.