His Little 1973 Startup Has Done OK

FedEx Corp. said Monday that Fred Smith will step down on June 1 as CEO of the package-delivery company he started a half-century ago, per the AP. Smith, 77, launched FedEx in 1973, delivering small parcels and documents more quickly than the post office could. Over the decades, he oversaw the growth of a company that combined air and ground service and became something of an economic bellwether because of its service to other companies. Smith informed FedEx employees of the news in a memo that retraced some of the Memphis-based company’s history. He recalled that FedEx started with 14 planes and 389 team members, who delivered 186 packages on the first day of operations.

“We were a small startup and had our share of skeptics,” Smith said. He boasted that the company went on to become a "global connector of people and possibilities that would change our world for the better.” FedEx and rival UPS have benefited in recent years from the boom in online shopping, which has meant more parcels for its drivers to deliver to customers' doorsteps. In 2019, as Amazon.com built up its own delivery business, FedEx dropped a contract to provide express delivery for the retail giant, and stopped ground deliveries for Amazon soon afterward.

FedEx was hurt by the trade war with China, and Smith frequently used forums such as the quarterly earnings call to rail against tariffs, making him one of the few CEOs of a large US corporation to challenge then-President Trump’s trade policies. Smith and a firm bearing his name own more than 19.2 million shares of FedEx, according to FactSet. They are worth more than $4.4 billion at Monday's closing price. Raj Subramaniam, the current company president, will serve as both CEO and president, and Smith will become executive chairman to focus on issues including sustainability, innovation, and public policy. (More FedEx stories.)