By Bloomberg News

Published: Tuesday, October 9, 2012, 10:06 p.m.
Updated: Tuesday, October 9, 2012

MEMPHIS — FedEx Corp. will take steps to cut costs and boost profit by $1.7 billion during the next three years to reposition the company as customers shift to slower, cheaper deliveries from costlier overnight shipments.

Chief Executive Officer Fred Smith set that target on Tuesday in a speech to analysts and investors in Memphis without saying how the goal will be achieved. Details, including savings and efficiency gains, will be made public at a meeting starting at 9 a.m. on Wednesday.

The changes will allow the operator of the world's largest cargo airline to “deliver the performance to ensure the near- and long-term success of FedEx,” Smith said in prepared remarks. “We believe we can do this even in low-growth environments for global trade and within the major economies.” The size of the target reflects FedEx's view that the move of some customers to ground, freight and even ocean shipping is permanent and not a temporary change linked to a slowing economy.

FedEx also announced that David F. Rebholz, president and chief-executive officer of Moon-based FedEx Ground, will retire effective May 31.

Rebholz, a native of Milwaukee who will be 60 when he retires, has led FedEx Ground operating unit since January 2007. He also serves on the Strategic Management Committee of FedEx Corp. A successor will be named later.

1. Apple defends tax strategy before Senate
2. Energy chief vows to review exports before acting on LNG applications
3. U.S. could seize 5 in Benghazi attack
4. Fire chief says search almost complete in Oklahoma
5. Across country, IRS gets an earful
6. IRS official to take the 5th at hearing
7. Massive tornado roars through Oklahoma City suburb
8. IRS targeting of conservative groups was no secret
9. Pennsylvania trooper injured in North Carolina accident
10. Okla. senators embrace disaster aid after opposing Sandy relief bill
11. Amid debris of tornado-ravaged Texas town, ‘miracle’ dog found

There are currently no comments for this story.
Subscribe today! Click here for our subscription offers.