February 23, 1999 5:08 PM, EST

Fedex: Contingency Plans Cost $90M

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MEMPHIS, Tenn. (AP) — FDX Corp., the parent of Federal Express, spent $90 million preparing for a pilots strike that never occurred, company officials said.

But FedEx officials said Monday that was $20 million to $30 million less than they expected to spend.

FedEx's 3,600 pilots threatened to walk out during the Christmas shipping season and the company began leasing planes and crews from other companies in preparation.

A strike was averted when negotiators for the two sides reached an agreement in early December. The pilots then overwhelmingly approved the contract, which gives them a 17 percent pay raise over five years, a better pension plan and input on scheduling.

The contingency expenses will be included in FDX's third-quarter earnings report. About $80 million will be included in operating expenses and $10 million in the interest/other category.

Memphis-based FedEx is the world's largest cargo airline. It has 145,000 employees worldwide and ships more than 3 million items to 211 countries each day.