Short Takes from the Chairman’s Desk
February 1, 2012

Below is an update on current issues. Please take a few moments to read about these issues, as I feel they are important for every FedEx pilot to understand.

Flight and Duty Time Update

This week, I am in Washington meeting with members of ALPA’s Government Affairs and Legal departments, members of our Legislative Affairs team, and the National Officers. I am scheduled to receive an update on our recent legislative efforts. I will be on Capitol Hill this week with our Legislative Affairs team in support of that effort.  As well, I have made arrangements to meet with ALPA’s legal team as we continue to evaluate all of our options going forward.

I previously wrote that the Department of Transportation publicly advised that it would undertake a campaign to encourage cargo operators to opt into Part 117. I will be attending the Aero Club luncheon where Secretary of Transportation LaHood will speak to that effort and other developments at the DOT. Finally, I will also have the opportunity to meet with IPA President Bob Travis to discuss the possibility of collaborative efforts.

Part 117

As the FTDT team has stated in the past, we want the new Flight and Duty Time rules versus the old Part 121 rules. That does not mean that Part 117 is perfect. Most recently, ALPA’s FTDT team submitted “Technical Correction Considerations” to the FAA to rectify some of these issues. In addition, the team has been running bid pack scenarios researching solutions to some of the issues in Part 117.

As you recall, I pressed FedEx to clearly advise the pilots where they stood on the “opt in.”  The Company responded to my inquiries with a letter which is linked for your reference.  The bottom line is that they have not made a decision concerning the Part 117. 

Fatigue Rick Management Committee (FRMC)

On January 17^th, the FDX ALPA FRMC team met with key Company Fatigue Risk Management Group (FRMG) members and discussed rollout of a new fatigue form within the ASAP reporting system. The plan includes the Company publishing a communication piece first with an overview of the FRMP (op spec A317). We will follow up with our own communication piece.

United States Postal Service Update

For months, we have been monitoring the situation at the USPS. The cutbacks are now beginning to take shape and unfortunately, it appears that they might affect FedEx. There is still wide divergence in opinion of how much of an impact the postal cutbacks will have on our operation. The excerpts below come from various news sources:

·         FedEx may see a drop of more than 27% (in Postal Contract volume only, not overall volume for FedEx Express (edit added)) in 2013 for a federal mail-flying contract if annual revenue from carrying USPS express, priority and first-class mail shrinks to less than $1 billion, according to SJ Consulting. A Postal Service goal of saving $2.1 billion a year isn’t reachable without “a reduction of the number of packages that they will need transported by air.”

·         1.4 Billion: That's how much money the U.S. Postal Service paid FedEx to deliver mail via cargo jets in fiscal 2010. Now that the agency is looking to slash its budget, airfreight is seen as a place to cut. Sending fewer packages by plane could reduce the payments to FedEx by about $400 million a year, according to SJ Consulting Group.

·         U.S. Postal ServiceLatest from The Business JournalsAquilent extends USPS workAquilent extends Postal Service workStudy: Postal cuts could cost business up to 0M a yearFollow this companyOne of those interested observers watching the USPS cutbacks will be FedEx Corp. FedEx Corp.Latest from The Business JournalsFedEx to pay 0,000 civil fine to U.S. governmentReport predicts Wilmington Air Park may struggle to take offReport: postal cuts may cost businesses 0M annuallyFollow this company The Memphis-based company has a multifaceted relationship with the largest postal operator in the world and changes to one will affect the other. “As a major customer of and supplier to the U.S. Postal Service, we support efforts to ensure that the Postal Service is able to successfully manage its business,” said Maury Donahue, manager of regulatory and public affairs communications for FedEx (NYSE: FDX). “FedEx has not taken a position on the various recent proposals. However, we have long advocated changes that would. On the surface, it may seem like the service reduction of a competitor might help FedEx, but the truth is more complex.”Morningstar Inc.Latest from The Business JournalsRutledge hire pays big for CharterMorningstar: Artisan team 'manager of year' Sears Holdings announces some store closuresFollow this company

Depending on how you measure it, the USPS is FedEx’s largest customer, but the USPS is not just a customer, not simply a competitor, and not just a logistics client - the relationship is more complicated. It is my opinion that the FedEx relationship is the best thing that the USPS has going for it. Additionally, it should be kept in mind that air freight that is presently being moved now through the USPS will still have to be flown in some manner by someone, and will likely land at FedEx or UPS at some ratio. We are continuously monitoring this situation and will update you as more information comes available.

Thank you for taking the time to read some of the current issues your union is addressing and monitoring. Please continue to stay informed and engaged as we move forward.

 In Unity,

Captain Scott Stratton
FDX ALPA MEC Chairman