The views expressed here are solely those of the author and do not necessarily represent the views of FreightWaves or its affiliates.
In many respects, the parcel market of 2024 still looks very much like that of 40 years ago when RPS broke into a practical monopoly of UPS (NYSE: UPS). While transit time is faster for ground service, the service offerings, operational network and technology have largely remained unchanged.
For example, the transit time commitments for overnight express delivery are still 10:30 a.m. and noon, the bar codes are the same despite major advancement in technology, and the zone concept — developed by the U.S. Postal Service many decades ago and before the interstate highways were built for faster transportation — is the same.
Even more shocking is that both FedEx (NYSE: FDX) and UPS still have a three-day deferred service as part of their portfolio of express services when their ground service is now faster in many lanes and at a considerably lower cost.
Furthermore, while the express services offered guaranteed delivery or money back for service failure, that guarantee was first suspended with the start of the COVID-19 pandemic in March 2020.
Then, after the pandemic was over, the guarantee was only restored for overnight express service. As such, two-day air express and three-day deferred express services offer no premium value for the much higher charge while being no faster, ...