Bill would bail out UPS, derail FedEx

Posted Dec. 03, 2009, at 4:08 p.m.

FedEx Express is proud to be a partner with businesses and communities across the state of Maine. We employ more than 300 hard-working Mainers and invest more than $1.3 million in rent at airports throughout Maine – an investment that helps provide needed revenue to airports in Portland, Bangor and Augusta. We are doing our share to contribute to Maine’s local economy, especially in these difficult times.

FedEx Express wants to remain partners with the Maine for years to come.

Unfortunately, legislation moving through Congress, if passed, would threaten the services provided by FedEx Express and could severely impede our ability to reliably serve cities and towns throughout Maine.

In May, the House of Representatives approved the Federal Aviation Administration Reauthorization Act of 2009. As a whole, the act is helpful to all air travelers as it modernizes the FAA and our country’s system of air travel.

However, buried in Section 806 of the 268-page document are approximately 230 words that would change how express-delivery companies are governed under U.S. labor laws, amounting to nothing less than a legislative bailout for just one company: UPS – a healthy company that pockets billions in revenue annually.

This issue is so important that I have traveled across the country to meet with local airport boards and community leaders to discuss, in person, the impact of this legislation.

Until FedEx Express was founded in 1971, UPS had a virtual monopoly on the shipping industry. They controlled prices and offered limited choices for consumers. FedEx Express changed all that by creating real competition, introducing overnight express delivery backed by a money-back guarantee and creating real competition in the parcel delivery sector. Express delivery has become a critical component of many businesses and our economy – especially in rural areas of Maine.

FedEx Express is one of the world’s largest airlines. More than 85 percent of what we carry goes by air and we operate on an international hub system, pay airline fees and taxes and run our operations like any other airline. In the United States we have more than 100 facilities and hubs that are part of this integrated delivery system. And like all other airlines, railroads and express companies (including a division of UPS), we are governed by the Railway Labor Act, which Congress created to ensure our country’s commerce runs reliably and predictably without disruptions from local disputes.

UPS is a fundamentally different company. More than 85 percent of their packages are shipped solely by ground vehicles. UPS is, essentially, a trucking company and as such are governed under a different set of rules established by the National Labor Relations Act.

Rather than simply compete in the market place, UPS has asked Congress to change the way our company is regulated by moving FedEx Express from the Railway Labor Act to the National Labor Relations Act.

What does this mean for the people and businesses in Maine? Should this legislation pass, there could be significant decreases in reliability and increases in overall shipping prices. Competition is good for our industry because it drives more innovation, competition, customer choices and multiple methods for shipping goods.

This debate isn’t new. Every few years, FedEx Express is dragged into this debate by UPS. We all know the current competitive environment is best for the economy and American consumers are tired of bailing out companies that will not compete. The United States Senate, including, Maine Sens. Olympia Snowe and Susan Collins, can prevent this ill-advised change, preserve our competitive shipping industry and ensure access to world markets from every corner of the state.

Congress should be fixing things that are broken, not tinkering with the fundamental design of FedEx Express, a classic American success story that has worked well for citizens across Maine and across the United States for nearly 40 years.

Maury Lane is the director of corporate communications at FedEx Corp.

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