FedEx cancels new distribution hub, citing efficient automation elsewhere

A planned $259 million FedEx distribution centre in Greenwood, Indiana, has been cancelled after automation and technological improvements made its other hubs more efficient, according to a FedEx spokesperson

“FedEx Ground is constantly evaluating the capacity needs of its network,” said FedEx. "Automation and technological enhancements we have made to our network over the last decade have enabled us to continue to increase the utilization of our existing capacity while serving the growing needs of our customers."

Sculptures by Rob Fisher at Indianapolis airport

The facility, covering 608,000 square feet, would have employed 455 people in full- or part-time jobs, some paying as much as $24 an hour. The location was considered ideal because of its proximity to other major cities and has seen recent investments from other companies including Amazon and UPS.

FedEx had applied for property tax abatements from the city worth $17.2 million over ten years.

Instead, FedEx is focusing on its operations at Indianapolis airport, where it plans to spend the $1.5 billion it just gained after its corporate tax rate was cut from 35% to 21%. The tax cut was promoted by its Republican supporters as a way to increase jobs and wages by promoting big business, though critics have suggested that it could enrich investors and company shareholders with little to be gained by the average worker.

At the time of its Indianapolis airport announcement in January, the company said it would be investing more than $200 million in employee raises in April and putting $1.5 billion towards its pension plan.

(Source: CNN, IndyStar)