Another Fedex slip-up draws more ire
Delivery mishap further strains relationship with tech company
Fedex is drawing ire from Huawei after what looks to be another Huawei-related delivery mishap, further straining its relationship with the technology company and possibly increasing its chance of landing on China’s blacklist.
A PCMAG writer based in the United Kingdom attempted to send his Huawei Mobile phone via Fedex to the publication’s New York office, but it was returned to sender the same day, said PCMAG Lead Analyst Sascha Segan.
A label on the package said it was returned “due (to) U.S. government issue with Huawei and China government.”
The U.S. has placed restrictions on domestic companies doing business with Huawei due to concern the telecommunications company is a national security threat, which Huawei has denied.
But the PCMAG writer shouldn’t have had a problem because the shipment wasn’t to or from one of the Huawei companies the U.S. has banned, Segan said. Instead, it was the shipment of a Huawei product between parties that aren’t subject to those restrictions.
PCMAG inquired with both Fedex’s customer support Twitter account and Fedex Media Relations to figure out what happened. Support said the return wasn’t a mistake and the return was made to comply with regulations, while Media Relations said the return was an
error, Segan said. “Everyone was confused,” he said. Fedex has not yet responded to The Commercial Appeal’s request for comment, but it told PCMAG in a statement the package “was mistakenly returned to the shipper” and it will try to minimize customer impact as it adjusts “to comply with a dynamic US regulatory environment.”
Huawei posted on Twitter that Fedex was not within its rights to prevent the delivery.
Segan said overlapping bans by the U.S. government could be making shipping Huawei items more confusing for couriers. Fedex Express Europe Regional COO David Canavan said an employee “had a panic attack of sorts” after seeing the phone’s description on included forms, according to a PCMAG report.
Not Fedex’s first Huawei slip-up
The debacle occurred about a month after Fedex said it misrouted some packages sent by Huawei.
Huawei said at the time the packages, which were supposed to stay within Asia, contained commercial documents and that the Memphis logistics giant attempted to divert other company packages. China has launched an investigation into the situation, which Fedex says it will cooperate with.
China is also expected to release an “unreliable entities” list similar to what the U.S. is enforcing for Huawei companies. What will happen to companies on the list is unclear, but a China Federation of Logistics & Purchasing representative told China’s Global Times it “seems highly likely that Fedex will be added onto the ‘unreliable entities list’” following the PCMAG issue.
A UBS analyst estimates roughly 4% of Fedex revenue is linked to China.
This was the first instance of a shipping mishap PCMAG has encountered over the U.s.-huawei dispute, Segan said. He added that PCMAG primarily ships through Fedex.
Fedex will report fourth-quarter and year-end earnings on Tuesday, wrapping up a challenging fiscal year for the company.
Max Garland covers Fedex, logistics and health care for The Commercial Appeal. Reach him at max.garland@commercialappeal.com or 901-529-2651 and on Twitter @Maxgarlandtypes.