FedEx unit buys 50 Boeing freighters; planes to phase out older MD-10 fleet

FedEx Corp. said late yesterday that its FedEx Express air and international unit will buy 50 Boeing 767 freighters for an undisclosed sum to replace older, less-efficient MD-10 cargo aircraft.

The aircraft will be delivered between FedEx's 2018 and 2023 fiscal years, the Memphis-based company said in a statement. Its 2016 fiscal year began June 1. The firm orders are in addition to options that FedEx holds on 50 B-767 planes, the company said. With this order, FedEx holds firm commitments for 106 of the B-767 planes, it said.

The B-767 has a maximum payload of 127,100 pounds, slightly less than the tonnage capacity of the old MD-10 planes it will replace, according to the company's statistics book. The B-767 is about 30 percent more fuel-efficient than its predecessor, and will yield a 20-percent reduction in operating costs, said Jess Bunn, a FedEx spokesman, in an e-mail. The planes will be used across the company's global network and not be confined to a specific region, he said.

The announcement had been telegraphed for some time. The company had said it planned to phase out the MD-10s for the B-767s. Interest was piqued several weeks ago when it was reported that FedEx and executives of Chicago-based Boeing had met in Seattle purportedly to discuss the order. Earlier reports surmised that the order would be larger than it actually was.

Published reports yesterday pegged the order's list price at about $10 billion. Bunn called the deal's terms "very favorable." Generally, aircraft purchasers negotiate substantial discounts off the list price for bulk orders.