In a Thursday interview with CNBC Jim Cramer, FedEx CEO Raj Subramaniam said his company can also do well in supply chain restructuring.
“As supply chain patterns change, we are here, there and everywhere,” he said. “That’s the benefit that people sometimes overlook. The fact that we have a scaled network gives us an advantage in these dynamic times.”.”
President-elect Donald Trump has threatened to dramatically increase import tariffs on several countries, particularly China, and those moves would likely disrupt global supply chains. While Subramaniam acknowledged that China currently accounts for about 28-30% of global production, he said the good news for FedEx is that its network is global, claiming the company supplies 99% of global trade.
This dynamic makes it easier for FedEx to “adjust and shift our capacity” and connect every point in the network to the rest of the world, he continued. Subramaniam also said the company is seeing better than expected demand this month. He believes consumers are more optimistic and suggested December could be a record month for the Port of Los Angeles.
FedEx reported a mixed quarter after the close of trading on Thursday announced It plans to spin off its freight business into another publicly traded company, FedEx Freight. Shares rose more than 8% in extended trading. Subramaniam said the demerger could help create long-term value for shareholders of both companies.
“We are sitting on global supply chain insights,” he said. “So we want to be not only a leading transportation network provider, but also a global provider of supply chain technology.”
