Dive Brief:
- FedEx Freight opened a 218-door facility in Phoenix earlier this year as the LTL carrier looks to take advantage of the growing market, according to a news release Aug. 8.
- The facility opened in late May, according to a FedEx spokesperson. Including the Arizona expansion, FedEx Freight's dock door count at its facilities has grown to almost 26,000 this year.
- “The continued growth in the Phoenix market coupled with our expanded footprint with additional doors provides us the much-needed capacity to meet the growing demand,” Scott Doleman, FedEx Freight regional vice president, said in a statement.
Dive Insight:
Phoenix has grown in prominence as a freight market. Chewy's in-house linehaul service launched in Phoenix earlier this year, and a TuSimple and Union Pacific partnership involves driverless trucks transporting goods to a distribution center near the city.
Industrial activity is also high in the area, with a 2.8% vacancy rate for distribution properties in Q2 following transactions from companies like Amazon and Waymo, according to CBRE. That rate was even with the overall market's vacancy rate, which CBRE said was a record low.
FedEx Freight’s new Phoenix site is among several projects underway to increase capacity at its facilities over the next several years through modernization and expansion projects, President and CEO Lance Moll said in a statement.
“We’re talking about more than adding buildings or square footage,” Moll said. “This is about strategically planning capacity increases to better serve our customers in growing markets.”
FedEx Freight continually evaluates its network — which includes a fleet of 30,000 vehicles and about 400 service centers — based on changing market conditions, the company noted in the release. Demand cooled for the company in its most recently reported quarter, with average daily shipments falling 4% YoY. However, revenue per shipment jumped 28% as the company focused on moving more profitable freight.
