FedEx will incur a $175 million loss during the peak season due to the grounding of its MD-11 aircraft.

FedEx has alerted investors that the grounding of its MD-11 cargo fleet, following a fatal UPS crash, will cost the company $175 million during the crucial holiday shipping season. This grounding, mandated by the FAA due to structural weaknesses, is causing significant logistical challenges for FedEx and UPS. CFO John Dietrich noted that costs for finding replacement capacity will heavily impact earnings, especially in the upcoming quarter. Despite these challenges, FedEx raised its adjusted operating income forecast to $6.2 billion, although it anticipates a $300 million decline in income for its Freight division.