UPS, FedEx Cap Holiday Deliveries Amid Late Surge
Delivery Giants Holding Retailers
to Volume Commitments
By Laura Stevens and Suzanne Kapner in
the Wall Street Journal
Sorry, last-minute holiday shoppers.
United Parcel Service Inc. and FedEx Corp.
started capping air express deliveries in recent days after an 11th-hour
increase in packages caused some retailers to exceed agreed-upon limits,
according to people briefed on the situation.
This year, both UPS and FedEx held
some retailers to their volume commitments during the final shopping days
before Christmas, aiming to avoid a repeat of last year’s fiasco. Last
Christmas, an estimated 2 million express packages didn’t arrive under the tree
in time, according to software tracking developer Shipmatrix Inc.
Tom Barone, the vice president of
North American operations for eBay Enterprise, which handles shipping and other
logistical issues for close to 100 brands and retailers, said delivery
companies had asked Tuesday for his clients to scale back last-minute shopping
deals to take some pressure off shipment volumes.
Mr. Barone said most of his clients
had already rolled back shipping deadlines to late afternoon on Dec. 23 for
delivery by Christmas Eve to minimize missed deliveries. Last year, the cutoff
went as late at midnight at some retailers.
Surging online shopping over the
holidays fueled by offers of free shipping and deep discounts tests the limits
of the infrastructure—planes, trucks and sorting hubs—used to deliver the gifts
to tens of millions of homes in neighborhoods from Miami to Seattle.
Last year, UPS was caught flat footed by
a surge in deliveries, a limited air fleet and bad weather and had to tell
millions of Americans their gifts wouldn’t arrive in time for Christmas. FedEx
said it wasn’t affected as badly, apparently because it rejected some
last-minute unexpected volume, a demand UPS tried to meet, although it conceded
it struggled with the weather.
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