Federal Express to Shrink in Europe
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MEMPHIS — Federal Express Corp. said Monday that it will slash its domestic business in Europe and reduce its work force there by 6,600. The air freight company said it will set aside $254 million to pay for the overseas restructuring.
Federal Express said the quarterly charge contributed to a loss of $193 million in its fiscal third quarter, which ended Feb. 29. The company has wrestled with a costly and difficult expansion abroad since 1985.
Federal Express will trim the number of its company-owned bases in Europe from 125 to 19. The remaining shops will focus on intercontinental business rather than deliveries between European cities or countries.
Federal Express will contract with independent carriers for pickups and deliveries outside 16 core cities. The company will cut its European work force from 9,200 employees to 2,600. The reorganization will start May 4.
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