Logistics provider FedEx is readying to slash nearly 500 jobs and close two of its U.S. facilities as part of a massive consolidation of its business.
The Memphis, Tennessee-based company with $87.7 billion in annual revenue disclosed it plans to cut 481 roles at distribution facilities in four U.S. states. The Worker Adjustment and Retraining Notification letters sent to various workforce and labor departments in Iowa, Nebraska, North Carolina and Texas also outline plans to close facilities.
The facility closures and cuts are part of a plan that FedEx calls "Network 2.0," which it unveiled a few years ago to streamline its operations. The multiyear effort is expected to integrate the company's FedEx Express and FedEx Ground networks in the United States and Canada for improved delivery, while reducing transportation costs.
To date, FedEx said it has "optimized" more than 300 stations in the United States and Canada. About 2.5 million packages are flowing through company-optimized stations, officials said.
A FedEx spokesperson confirmed that the WARN letters received in the four U.S. states were the only ones issued in the past week. The spokesperson declined to comment on future consolidation plans.
FedEx plans to close a package distribution center totaling nearly 600,000 square feet along Old Oak Ridge Road in Greensboro, North Carolina, as well as close a nearly 90,000-square-foot facility at 7130 Q St. in Omaha, Nebraska. The company also plans to cut 164 jobs tied to the Greensboro facility effective Sept. 1. Likewise, FedEx also plans to eliminate 102 employees at its Omaha facility beginning Sept. 1.
The majority of the work in Omaha is being relocated to another facility within 50 miles of the one being closed by the company, a FedEx executive said in its letter to the Nebraska Department of Labor.
FedEx also plans to cut 84 workers from its hub at 700 S. West Ninth St. in Des Moines, Iowa, beginning on Sept. 1. The shipping center is expected to remain operational, a FedEx spokesperson told CoStar News.
The company also plans to eliminate 81 jobs at 3242 Herrmann Drive in Garland, Texas, and cut 50 jobs at 1200 Capital Ave. in Plano, Texas. The Dallas-area job cuts are expected to be effective Sept. 1. Both North Texas facilities will remain operational, with a reduced head count, a FedEx spokesperson told CoStar News.
“As part of our previously announced network transformation strategy, FedEx will reduce staff at the facilities on Herrmann Drive in Garland and Capital Avenue in Plano in September," a FedEx spokesperson told CoStar News in an email. "Team members at the facilities were notified several months ago, and many will be offered other roles within the company.
"These decisions are never taken lightly and reflect our commitment to supporting affected employees — through job placement assistance, relocation aid, or severance, as applicable — while transforming our network and continuing to provide an outstanding experience for our customers," the spokesperson added.
In North Texas, FedEx employs more than 15,000 employees using 126 facilities, officials said.
Network 2.0
FedEx plans to close 30% of its U.S. package distribution facilities within two years, FedEx President and CEO Raj Subramaniam said during the company's fourth-quarter 2025 earnings call in late June. The Network 2.0 plan is expected to be completed by the end of fiscal 2027 and save a total of $2 billion.
In its latest update, FedEx executives said the firm closed about 100 shipping stations and integrated about 290 hubs. By the end of fiscal 2025, FedEx optimized its entire Canadian fleet, with plans to continue in the United States this upcoming fiscal year.
FedEx expects to save $1 billion as part of its consolidation during fiscal year 2026. The company reported its lowest capital expenditure-to-revenue level in its company history as it looks to streamline its business.
The consolidation of FedEx comes at a time of upheaval at the company, with its decades-long relationship with the U.S. Postal Service coming to an end last September. The postal service selected UPS for the contract in lieu of FedEx last year. The company is also preparing to spin off its freight business as its own public company in June 2026.
The U.S. Postal Service contract expiration is expected to bring a "near-term headwind" of $120 million, executives said in the fourth-quarter 2025 earnings call, with a forecast for a $170 million headwind tied to international exports.
The headwinds tied to the uncertain trade and tariff environment are difficult to predict, leaving FedEx executives from providing any full-year guidance for 2026.
"We're going to be focusing on those things within our control," FedEx Chief Financial Officer John Dietrich said during the recent earnings call.