FedEx to retire 24 aircraft as part its fleet realignment
Jun 04, 2012 (Menafn - The Commercial Appeal - McClatchy-Tribune Information Services via COMTEX) --FedEx Corp. announced today it will permanently retire 24 aircraft and related engines and accelerate depreciation on 54 others due to be replaced by newer aircraft.
Retirements of 18 Airbus A310-200s and six Boeing MD 10-10s are part of a fleet realignment carrying a one-time, non-cash, pre-tax impairment of expense of 134 million in the fourth quarter.
FedEx said in a release that retirement of the planes, which aren't in revenue service, will better align the U.S. domestic air network capacity of FedEx Express to match current and anticipated shipment volumes.
It's also shortening the depreciable lives of older aircraft and related engines that are scheduled to be replaced by newer, more fuel-efficient Boeing 767-300s and 757-200s. The company expects accelerated depreciation to total 196 million, with a partial offset, over the next three fiscal years.
The 24 newly announced aircraft retirements come in addition to five Boeing 727-200s retired during the current quarter and planned retirement of 21 more fully depreciated 727s in the fiscal year starting June 1.
"Along with the decisions to retire these 50 aircraft, we are also developing detailed operating and cost structure plans to further improve our efficiency," said David J. Bronczek, FedEx Express president and chief executive officer. "We expect to provide additional information on these plans in the fall."
Analysts have been expecting news about express restructuring to precede or coincide with an investor and analyst conference scheduled for October.
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