FedEx Express’s new head
FedEx’s (FDX) chair and CEO, Fredrick Smith, finally found someone to lead the company’s Express business unit. The delivery services provider yesterday announced that it had appointed Don Colleran to be president and CEO of the Express division, effective March 16.
Colleran started his career with FedEx as an international sales manager. In his 30-year tenure at the company, Colleran has been promoted several times to key executive positions including president of FedEx Express Canada in 2000, senior vice president of international sales in 2003, and executive vice president of global sales in 2006. Colleran currently serves as executive vice president and chief sales officer of FedEx.
Colleran will be replacing Raj Subramaniam, who became the company’s president and COO last month after the sudden departure of the then president and COO, David Bronczek, on February 15. Bronczek’s sudden resignation was surprising, as he’d been appointed to FedEx’s board just days ago on January 28.
Investors found it unusual and worried about what unexpected things may have happened since he joined the board. That was the second time since December last year that a key FedEx executive had resigned. Before Bronczek’s resignation, the president and chief executive of the FedEx Express division, David Cunningham, announced his retirement in December 2018. He has been heading the segment since early 2017.
Continuous management reshuffling could increase FedEx’s challenges further. The courier services giant is already concerned about a possible slowdown in its international business. During its fiscal 2019 second-quarter earnings results, which were reported on December 18, FedEx stated that global trade had been slowing and could decelerate even further in the coming months.
The company lowered its fiscal 2019 earnings outlook, citing weakness in its international business, mainly in Europe. FedEx noted that a significant slowdown in the United Kingdom due to Brexit uncertainty, a contraction in Germany’s GDP, and protests in France had hurt its international business.
FedEx stock has risen 9.4% YTD. Other major logistics companies (IYT) C.H. Robinson Worldwide (CHRW), United Parcel Service (UPS), and Expeditors International of Washington (EXPD) are up 5.7%, 11.6%, and 11.9%, respectively, YTD.