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His vision helped establish a business model that has benefited countless companies globally.
Fred Smith, the president and founder of FedEx, has passed away at the age of 80 from natural causes in Memphis, the company has announced. Smith was a prominent figure in the global transportation and logistics industry, transforming Federal Express into the largest express transportation company worldwide.
Smith began his career in the transportation world in 1965 while studying at Yale University. He first conceived the idea of creating a radial network for overnight package deliveries using jet planes. After serving in two missions in Vietnam as a Marine, he convinced investors to support his idea. Today, FedEx connects over 220 countries and territories, managing more than 17 million shipments daily.
FedEx, a vision realized
Fred Smith was a visionary in the world of freight transportation. Driven by his passion for aviation, he first invested in an aircraft maintenance company in Little Rock, Arkansas, and later founded FedEx with his own funds and the support of initial investors. Before receiving regulatory approval, he purchased Falcon 20 jets and adapted them for freight transport.
Once operations were underway, the company moved to Memphis for its strategic location, and deliveries began in April 1973. Though it had a tough start and faced financial problems, Smith managed to overcome the obstacles.
Slowly, the next-day delivery service began to gain popularity, which elevated FedEx to the top. In 1988, UPS responded with its own air cargo service, and Smith countered in 1998 by purchasing Caliber Systems Inc., which later became FedEx Ground, a key division that introduced the use of barcodes for tracking.
FedEx Ground became the most profitable division, using a pay-per-package model with contractors, which helped prevent the unionization of drivers. Smith opposed unions, and although pilots voted to unionize in 1993, they did so under the Railway Labor Act, which restricted their rights.
Smith was also a staunch advocate of free trade. During Donald Trump’s presidency, he opposed the protectionist policies and tariffs imposed by the administration.
Fred Smith’s legacy: FedEx and contributions to global commerce
FedEx revolutionized the industry by introducing the next-day air delivery service, a significant change in a sector that was previously unprepared for such speed. However, with the rise of e-commerce and the competition from Amazon, FedEx began to face challenges. Smith’s response to these difficulties was to reorganize FedEx Ground, extending the service to seven days a week, improving facilities for large packages, and optimizing routes with software.
During the pandemic, FedEx thrived by taking on a larger volume of overnight cargo following the reduction in airline flights. It also played a crucial role in transporting personal protective equipment and the global distribution of vaccines in 2021.
Fred Smith’s legacy extends beyond freight transport. He was co-chair of the World War II Memorial project and the campaign for the National Museum of the Marine Corps. He was also a dedicated father, having two children with his first wife, Linda Black Grisham, and eight children with his second wife, Diane. His commitment also spanned education, veterans’ affairs, and environmental sustainability, ensuring that FedEx had a positive impact on communities around the world.
Through his philanthropic support in areas such as education, healthcare, sports, the arts, and community development, Smith helped reshape Memphis while revolutionizing express freight transportation. His vision helped establish a business model that has benefited countless companies globally.
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