The board of directors of FedEx approved a plan on Wednesday to spin off its less-than-truckload (LTL) business, FedEx Freight. This move marks another significant step since the company announced the spin-off in December 2024, aiming to make the carrier an independently operated company. According to the announcement, after the spin-off is completed, FedEx Freight's stock will begin trading on the New York Stock Exchange on June 1 under the ticker symbol "FDXF."

Although the spin-off is formally similar to the launch of a startup, industry experts point out that FedEx Freight is by no means a new player in the LTL sector. A company spokesperson told Trucking Dive via email that FedEx Freight will retain its current name for several years to come. Under a trademark agreement with FedEx, FedEx Freight has the right to use the brand for the next 5 to 10 years. The spokesperson added that the agreement expires after the initial five-year period, but will automatically renew on a one-year basis unless terminated by FedEx Freight or FedEx, for a maximum of 10 years.

In addition to retaining the name, the more than one-year preparation period for the spin-off has also allowed FedEx Freight to optimize processes and technology, enabling it to operate its LTL business more efficiently after becoming independent. Scooter Sayers, an LTL consultant at Sayers Logistics, said that FedEx Freight emphasized during its April 8 Investor Day event that the company needed to shed its image as a former global platform that failed to properly handle LTL freight, and instead focus on the key changes needed to compete from day one after the spin-off.

"To prepare for the spin-off, they realized they had to abandon their existing operating platform and replace it with a brand-new one," Sayers said. He believes FedEx Freight may follow carriers such as Landstar System, Roadrunner, Schneider National, Ward Transport & Logistics, and ArcBest in using artificial intelligence to streamline processes and improve operational efficiency.

What has drawn even more attention from other LTL carriers is that FedEx Freight introduced a new class-based rating and pricing platform during Investor Day. Sayers noted that the platform can directly handle dimensional-based pricing, which determines prices based on the weight, dimensions, and density of pallets. Sayers commented, "They called it an industry first, which may be a bit of an exaggeration, but I think FedEx Freight will make this a key part of its future sales proposition—a pricing solution that bypasses the traditional freight class system."

Jonathan Phares, an assistant professor of supply chain management at Iowa State University, believes that FedEx Freight's load management technology will require existing customers to migrate to the new system, which may bring some short-term challenges, but customers should adapt quickly. Phares said, "FedEx Freight doesn't strike me as a startup. Startups often have to struggle to build legitimacy and growth for survival, usually by disrupting existing markets or creating new ones." He added that FedEx Freight, launched by FedEx in 2001, has long passed that stage. "FedEx Freight is already on second or third base because they already have the infrastructure and a strong customer base," Phares said, "They are building new technology and processes out of necessity."