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Home / Business / FedEx CEO says trade war surprised him as a "Mike Tyson" blow to his face

FedEx CEO says trade war surprised him as a "Mike Tyson" blow to his face



<p class = "canvas-atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "FedExs ( FDX ) top leads the attack of today's US trade policy as more protectionist measures threaten to maintain the courier's business plans and take a bite out of the bottom line. "data-reactid =" 31 "> FedExs (FDX) tops the attack of today's US trade policy as more protectionist measures threaten to offset the courier company business plans and take a bit out of the bottom line.

"It reminds me a little about Mike Tyson's old saying that everyone has a plan until they reach their mouths," said FedEx director Fred Smith. "Of course, we've been very disappointed over the past few years with the assumptions that we has made the growth of international trade, especially with the Trump administration. "

Smith made his remarks during an interview with investors on Tuesday in response to Barclay's analyst Brandon Oglensky's inquiry into FedEx's growth strategy, particularly related to the company's Express International Air Shipping business

<p class = "canvas-text text Mb (1.0em) Mb (0) – sm Mt 0.8 em) – sm" type = "text" content = "FedEx Express & # 39; operating revenue came under pressure in the fourth quarter, and the company refused to project the financial result for the performance of the FedEx segment. FedEx said trade disputes and low global growth levels created "significant uncertainty" for the business unit. "data-reactid =" 34 "> FedEx Express's operating revenues came under pressure in the fourth quarter, and the company refused to project the financial result for the segment. FedEx said trade conflicts and low global growth levels created" significant uncertainty "for the business unit.

"The US policy since 1934 with Roosevelt and Prime Minister Cordell Hull was expanding international trade," Smith said. "And now we have a big dispute where the United States is basically being protectionist defined as," I'll do everything I need in my own borders. I do not need to import things and quite frankly do not really need to export them. "

Smith also recognized what he considered to be wrong with other countries' trade policies, which have further confused global trade flows

." Nor are we agree with the Chinese position on trade, and it has been very vocal about it – which is mercantilist, "he added.

FedEx reported in its fourth quarter earnings that the results for the current financial year will be adversely affected by "weakness in global trade and industrial production". The company steered towards a mid-digit percentage drop in fiscal policy 2020 diluted earnings per share after adjustment for certain pension schemes and integration expenses related to the acquisition of TNT Express.

<p class = "canvas-atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "For & nbsp; fourth quarter last year FedEx reported better than expected results on top and bottom lines, and delivered adjusted earnings per share of $ 5.01 on revenue of $ 17.8 billion. "Data-response time =" 39 "> FedEx reported for the fourth quarter that It was better than the expected result on the top and bottom lines, delivering adjusted earnings per share of $ 5.01 on revenue of $ 17.8 billion.

& # 39; Almost impossible task & # 39;

FedEx has also addressed other issues in US trade policy.

Memphis, Tennessee-based company earlier this week filed a lawsuit against the US Commerce Department and requested that the government "be permanently urged to enforce the export management regulations against FedEx under circumstances when the company does not know that the contents of the shipment are subject [Export Administration Regulations] said FedEx Secretary General

<p class = "canvas-atom canvas-text Mb (1.0em) FedEx said the export restriction rules" mainly deputies FedEx to police it "(1945900016) case processing – sm Mt (0.8em ) – sm "type =" text "content of millions of packages sent daily even though it is, it is a virtually impossible task, logistically, economically and in many cases legal." FedEx claims it should not be responsible in the event that it accidentally sends products that violate Trump management's restrictions. "data-reactid =" 43 "> In a court filing, FedEx said the export restrictions" mainly deputies FedE x to police the contents of millions of packages it is sent daily, even though it is a virtually impossible task, logistically, economically, and in many cases legal. "FedEx claims it should not be responsible if it accidentally sends products that violate Trump's restrictions.

FedEx sues the US Department of Commerce to require the company to carry out additional screening measures to enforce export bans. (Photo by Justin Sullivan / Getty Images)

The case, which is not specifically called the Chinese telecommunications company Huawei in its court case, took place after the US government in May left Huawei a list of entities blocked from receiving US technology without a license from the trading department. Shortly thereafter, Huawei complained that FedEx had delivered several of its packages to the wrong addresses, and was a survey by FedEx of China.

FedEx CEO Smith on Tuesday argued that the events with Huawei were the primary motivation for the decision to file the case.

"The Huawei packages were only peripherally involved in this lawsuit we filed," he said. "And in fact it goes back many, many years, which is in the lawsuit itself and it does not apply to smuggling, as many have confused the case as if. It is about import and export controls administered by the Ministry of Commerce."

<p class = "canvas-fabric canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" trade secretary Wilbur Ross disagreed with the FedEx position in an interview with Fox News & nbsp; Tuesday, saying: "The regulation states that regular carriers cannot deliberately send goods in violation of unit list or other export control authorities. It does not require a common carrier to be a police officer or know what is in each package." "Data response =" Trade Secretary Wilbur Ross disagreed with the FedEx position in an interview with Fox News on Tuesday, saying: "The Ordinance states that regular carriers cannot deliberately dispatch goods in contravention of the business list or other export control authorities. It does not require a regular carrier to be a police officer or to know what is in each package. "

Smith noted that five new companies were added to Commerce Departments Entity List by companies last Friday" with extraordinarily opaque requirements "on export controls. Smith said fines for violations currently totaling $ 250,000 per package.

<p class = "canvas-atom canvas text Mb (1.0em) Mb (0) – Sm Mt (0.8em) Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck "data-reactid =" 74 "> Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck

<p class = "canvas-atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "19459042]" Read more from Emily: "data-response time =" 75 " > Read more from Emily:

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