Dan Sullivan, CEO of Fedex Ground

This is a partial transcript from Your World with Neil Cavuto, November 28, 2003, that was edited for clarity.

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TERRY KEENAN, HOST: And as more shoppers point, click and buy this holiday season, that does mean more business for my next guest’s company. FedEx Ground is expected to reach record volumes this holiday season. And for you late shoppers, they do deliver right up until Christmas Eve. Joining me now from Pittsburgh, Dan Sullivan, the CEO of FedEx Ground.

And Dan, good to have you with us again this year. Give us some holiday shopping tips. When is the last day that we can order to get our gifts by Christmas Eve?

DAN SULLIVAN, FEDEX GROUND CEO (FDX): Well, the last day that you might want to ship is December 23 by our FedEx express unit. We’ll deliver right up until Christmas Eve.

KEENAN: We have been hearing some pretty optimistic numbers on the e- tailing side, perhaps a 40 percent increase in 2003 for the holiday shopping season. Is that about what you are expecting?

SULLIVAN: Oh, absolutely. We are seeing a tremendous increase in the e-tailing side of our business. Companies like Amazon.com (AMZN), Overstock.com (OSTK), Gap Online, and many, many others are shipping at advance rates this year to be sure.

KEENAN: You know, we of course had that huge shakeout in 2000 and 2001, which hundreds of these e-commerce companies went out of business. Are you starting to see new names pop up this year?

SULLIVAN: Yes, I think we are. Our number of customers has doubled with our FedEx home delivery unit this year. Up to about 45,000. And of course several of those are online e-tailers.

KEENAN: How much pricing pressure are you feeling? We just had UPS (UPS) this week giving its smallest increase in prices in the last seven years. It hurt your stock a bit. Are you feeling the same sort of price pressure?

SULLIVAN: Well, there is no question that there is a competitive pricing environment out there. At this time, we are analyzing what we might do for 2004. Looking at our cost structure and what value we might want to bring to our customers next year. And we fully expect to have an announcement in the next several days regarding what our strategy will be for next year.

KEENAN: All right. We’ll be looking for that as well. Thanks for joining us. Happy holidays.

SULLIVAN: Same to you, Terry.

KEENAN: Dan Sullivan of FedEx.

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