filings.toolsItem 2. PROPERTIES
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Item 2. PROPERTIES
FedEx Express Segment
FedEx Express’s principal owned and leased properties include its aircraft, vehicles, major sorting and handling facilities, administration buildings, FedEx Drop Boxes and data processing and telecommunications equipment.
Aircraft and Vehicles
As of May 31, 2017, FedEx Express’s aircraft fleet consisted of the following:
| Description | Owned | Leased | Total | Maximum Gross Structural Payload (Pounds per Aircraft)(1) | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Boeing 747-400 | 2 | — | 2 | 261,400 | ||||||||||||
| Boeing B777F | 27 | 3 | 30 | 233,300 | ||||||||||||
| Boeing MD11 | 41 | 16 | 57 | 192,600 | ||||||||||||
| Boeing MD10-30 | 12 | 1 | 13 | 175,900 | ||||||||||||
| Boeing MD10-10 | 26 | — | 26 | 137,500 | ||||||||||||
| Boeing 767F | 43 | 3 | 46 | (2) | 127,100 | |||||||||||
| Airbus A300-600 | 32 | 36 | 68 | 106,600 | ||||||||||||
| Airbus A310-300 | 10 | — | 10 | 83,170 | ||||||||||||
| Boeing B757-200 | 119 | — | 119 | 63,000 | ||||||||||||
| ATR-72 | 21 | — | 21 | 17,970 | ||||||||||||
| ATR-42 | 26 | — | 26 | 12,070 | ||||||||||||
| Cessna 208B | 239 | — | 239 | 2,830 | ||||||||||||
| Total | 598 | 59 | 657 |
| (1) | Maximum gross structural payload includes revenue payload and container weight. |
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| (2) | Includes one aircraft not currently in operation and undergoing modification. |
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At May 31, 2017, FedEx Express operated approximately 58,000 vehicles and trailers.
Aircraft Purchase Commitments
The following table is a summary of the number and type of aircraft we were committed to purchase as of May 31, 2017, with the year of expected delivery:
| B767F(1) | B777F(2) | Total | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2018 | 14 | 4 | 18 | |||||||||
| 2019 | 15 | 2 | 17 | |||||||||
| 2020 | 16 | 3 | 19 | |||||||||
| 2021 | 10 | 3 | 13 | |||||||||
| 2022 | 10 | 4 | 14 | |||||||||
| Thereafter | 6 | — | 6 | |||||||||
| Total | 71 | 16 | 87 |
| (1) | As of May 31, 2017, our obligation to purchase four of these aircraft was conditioned upon there being no event that causes FedEx Express or its employees to not be covered by the RLA. |
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| (2) | As of May 31, 2017, our obligation to purchase six of these aircraft was conditioned upon there being no event that causes FedEx Express or its employees to not be covered by the RLA. |
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As of May 31, 2017, deposits and progress payments of $729 million had been made toward aircraft purchases and other planned aircraft-related transactions. Also see Note 17 of the accompanying consolidated financial statements for more information about our purchase commitments.
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Sorting and Handling Facilities
At May 31, 2017, FedEx Express operated the following major sorting and handling facilities:
| Location | Acres | Square Feet | Sorting Capacity (per hour)(1) | Lessor | Lease Expiration Year | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| National | ||||||||||||||||
| Memphis, Tennessee | 784 | 3,768,345 | 475,000 | Memphis-Shelby County Airport Authority | 2036 | |||||||||||
| Indianapolis, Indiana | 316 | 2,509,000 | 214,000 | Indianapolis Airport Authority | 2028 | |||||||||||
| Regional | ||||||||||||||||
| Fort Worth, Texas | 168 | 948,000 | 76,000 | Fort Worth Alliance Airport Authority | 2021 | |||||||||||
| Newark, New Jersey | 70 | 595,000 | 156,000 | Port Authority of New York and New Jersey | 2030 | |||||||||||
| Oakland, California | 75 | 448,935 | 63,000 | City of Oakland | 2036 | |||||||||||
| Greensboro, N. Carolina | 165 | 593,000 | 29,000 | Piedmont Triad Airport Authority | 2031 | |||||||||||
| Metropolitan | ||||||||||||||||
| Chicago, Illinois | 66 | 597,000 | 23,000 | City of Chicago | 2018/2028(5) | |||||||||||
| Los Angeles, California | 34 | 305,300 | 57,000 | City of Los Angeles | 2021/2025(6) | |||||||||||
| International | ||||||||||||||||
| Anchorage, Alaska(2) | 64 | 332,000 | 25,000 | State of Alaska, Department of Transportation and Public Facilities | 2023 | |||||||||||
| Paris, France(3) | 111 | 1,238,000 | 63,000 | Aeroports de Paris | 2029 | |||||||||||
| Cologne, Germany(3) | 11 | 325,000 | 20,000 | Cologne Bonn Airport | 2040 | |||||||||||
| Guangzhou, China(4) | 155 | 873,006 | 64,000 | Guangdong Airport Management Corp. | 2029 | |||||||||||
| Osaka, Japan(4) | 17 | 425,206 | 9,000 | Kansai Airports | 2024 |
| (1) | Documents and packages. |
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| (2) | Handles international express package and freight shipments to and from Asia, Europe and North America. |
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| (3) | Handles intra-Europe express package and freight shipments, as well as international express package and freight shipments to and from Europe. |
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| (4) | Handles intra-Asia express package and freight shipments, as well as international express package and freight shipments to and from Asia. |
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| (5) | Property is held under two separate leases — lease for original hub expires in 2018, and lease for new facility expires in 2028. |
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| (6) | Property is held under two separate leases — lease for sorting and handling facility expires in 2021, and lease for ramp expansion expires in 2025. |
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FedEx Express’s primary sorting facility, which serves as the center of its multiple hub-and-spoke system, is located at the Memphis International Airport. FedEx Express’s facilities at the Memphis International Airport also include aircraft hangars, aircraft ramp areas, vehicle parking areas, flight training and fuel facilities, the FedEx Cold Chain Center, administrative offices and warehouse space.
FedEx Express leases these facilities from the Memphis-Shelby County Airport Authority (the “Authority”). The lease obligates FedEx Express to maintain and insure the leased property and to pay all related taxes, assessments and other charges. The lease is subordinate to, and FedEx Express’s rights thereunder could be affected by, any future lease or agreement between the Authority and the U.S. government.
FedEx Express has additional international sorting-and-handling facilities located at Narita Airport in Tokyo, Stansted Airport outside London and Pearson Airport in Toronto. FedEx Express also has a substantial presence at airports in Hong Kong, Taiwan, Dubai and Miami.
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Administrative and Other Properties and Facilities
The World Headquarters of FedEx Express is located in southeastern Shelby County, Tennessee. FedEx Express owns or leases 624 facilities for city station operations in the U.S. In addition, 576 city stations are owned or leased throughout FedEx Express’s international network. The majority of these leases are for terms of five to ten years. City stations serve as a sorting and distribution center for a particular city or region. We believe that suitable alternative facilities are available in each locale on satisfactory terms, if necessary.
As of May 31, 2017, FedEx Express had approximately 39,000 Drop Boxes. FedEx Express customers can also ship from approximately 22,000 staffed drop-off locations, including FedEx Office centers and FedEx Authorized ShipCenters. Internationally, FedEx Express had approximately 19,000 drop-off locations.
TNT Express Segment
TNT Express corporate offices are located in Hoofddorp, The Netherlands. As of May 31, 2017, TNT Express had nearly 1,000 facilities worldwide, including road hubs, air hubs, depots and office facilities. These facilities are strategically located to cover the geographic areas served by TNT Express. TNT Express operates a central air hub near Liege, Belgium and a central European road hub in Duiven, The Netherlands. Approximately 39,000 owner-operator vehicles and 7,000 company-owned or company-leased vehicles support TNT Express’s business.
FedEx Ground Segment
FedEx Ground’s corporate offices are located in the Pittsburgh, Pennsylvania area. As of May 31, 2017, FedEx Ground had approximately 58,000 company-owned trailers and owned or leased 588 facilities, including 36 hubs. In addition, approximately 57,000 owner-operated vehicles support FedEx Ground’s business. Of the 394 facilities that support FedEx Home Delivery, 345 are co-located with existing FedEx Ground facilities. Leased facilities generally have terms of five years or less. The 36 hub facilities are strategically located to cover the geographic area served by FedEx Ground. The hub facilities average approximately 436,000 square feet and range in size from approximately 107,000 to 825,500 square feet. In addition, FedEx Supply Chain has 110 facilities through which it operates its supply chain logistics services.
FedEx Freight Segment
FedEx Freight’s corporate headquarters are located in Memphis, Tennessee, with some administrative offices for the FedEx Freight business in Harrison, Arkansas. As of May 31, 2017, the FedEx Freight segment operated approximately 66,000 vehicles and trailers and nearly 370 service centers, which are strategically located to provide service throughout North America. These facilities range in size from approximately 1,000 to 220,000 square feet of office and dock space. FedEx Custom Critical’s headquarters are located in Green, Ohio.
FedEx Services Segment
FedEx Services’ corporate headquarters are located in Memphis, Tennessee. FedEx Services leases state-of-the-art technology centers in Collierville, Tennessee and Colorado Springs, Colorado. These facilities house personnel responsible for strategic software development and other functions that support FedEx’s technology and e-commerce solutions.
FedEx Office’s corporate headquarters are located in Plano, Texas in leased facilities. As of May 31, 2017, FedEx Office operated more than 1,800 customer facing centers and also operated 33 centralized production centers. Substantially all FedEx Office centers are leased, generally for terms of five to ten years with varying renewal options. FedEx Office centers are generally located in strip malls, office buildings or stand-alone structures and customer-facing centers average approximately 3,800 square feet in size.
FedEx Services has an agreement with Office Depot, Inc. to offer FedEx Express and FedEx Ground shipping services at Office Depot and OfficeMax retail locations (approximately 1,400 locations). Additionally, the FedEx Authorized Ship Center program offers U.S. domestic and international FedEx Express and FedEx Ground shipping and drop-off services through a network of over 5,000 franchised and independent “pack and ship” retail locations.
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