Cover of FedEx CEO on Physical AI, the Big Bet on Data, and the Two Trillion-Dollar Supply Chain Problem

FedEx CEO on Physical AI, the Big Bet on Data, and the Two Trillion-Dollar Supply Chain Problem

FedEx CEO on Physical AI, the Big Bet on Data, and the Two Trillion-Dollar Supply Chain Problem

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Summary
 Before 2020, few people thought about supply chains. The pandemic put them on every boardroom agenda, and trade and geopolitics now make them critical issues for every global company. Few businesses have a better view into what changed than FedEx.In this episode of TechSurge, host Michael Marks speaks with Raj Subramaniam, who has run FedEx since 2022 as only the second CEO in the company’s history after founder Fred Smith. The company moves close to 18 million packages a day across more than 220 countries and territories, roughly $2 trillion of goods a year.Subramaniam shares his perspective on “re-globalization”, describing a fundamental shift in trade patterns that began in 2025. He walks through the operational shock of the US ending de minimis treatment for low-value imports, which forced FedEx to formally clear six times as many packages and hire more than 2,000 people in a matter of weeks, and explains why the company has quietly opened new hubs and routes across Asia, the Middle East, and Latin America to stay ahead of shifting trade flows.The conversation turns to data and AI: FedEx scans 18 million packages roughly 20 times a day, generating two petabytes of data daily, which the company uses for everything from predictive logistics for hospital deliveries to an AI tool that picks the correct customs classification code for international shipments. Subramaniam also discusses FedEx’s expanding use of physical AI, including robotic trailer-loading partnerships with Dexterity and Berkshire Grey and nearly a million miles of autonomous trucking with Aurora in Texas, and makes the case that AI is adding jobs at FedEx rather than eliminating them.Marks and Subramaniam also discuss why Amazon is a FedEx customer rather than a competitor, the company’s recent spinoff of FedEx Freight, its new supply chain orchestration partnership with the US Army, and Subramaniam’s own 35-year career at FedEx, including his path as an immigrant who rose to lead the company.Sign up for our newsletter at techsurgepodcast.com for updates on upcoming TechSurge Live Summits and future episodes.Speaker Profiles and LinksMichael Marks: Founding Managing Partner, Celesta CapitalRaj Subramaniam: President and CEO, FedEx Wikipedia: https://en.wikipedia.org/wiki/Raj_SubramaniamLinkedInhttps://www.linkedin.com/in/rajeshsubramaniam1/ Further Reading and ResourcesWhite House – Executive Order 14324, ending de minimis duty-free treatment: https://www.whitehouse.gov/presidential-actions/2025/07/suspending-duty-free-de-minimis-treatment-for-all-countries/Supply Chain Dive – FedEx’s 2025 shipping agreement with Amazon: https://www.supplychaindive.com/news/fedex-amazon-new-shipping-contract-2025/747942/FedEx Newsroom – FedEx and Dexterity’s physical AI trailer-loading deployment: https://newsroom.fedex.com/newsroom/global-english/fedex-and-dexterity-expand-physical-ai-deployment-for-autonomous-trailer-loading-at-hagerstown-hubFedEx Newsroom – FedEx and Aurora autonomous trucking partnership: https://newsroom.fedex.com/newsroom/fedex-teams-up-with-aurora-and-paccar-to-test-autonomous-linehaul-technology/U.S. Army – Strategic Capital Initiative with FedEx Dataworks: https://www.army.mil/article/294805/army_launches_flagship_strategic_capital_initiative_with_fedex_dataworks_to_modernize_logistics_infrastructureFortune – Profile of Raj Subramaniam: https://fortune.com/2026/07/15/fedex-ceo-raj-subramaniam-tariffs-supply-chain-shipping-fortune-500-titans-and-disruptors-of-industry/Timestamps [00:00] Why Supply Chains Became a Boardroom Issue [00:38] Introducing Raj Subramaniam and FedEx [02:27] Is Today’s Trade Environment “Business as Usual”? [02:50] Megatrend One: Changing Trade Patterns [05:44] Megatrend Two: The $1.8 Trillion Supply Chain Problem [07:37] What Actually Changed in 2025 [08:00] The End of De Minimis: A 6x Customs Surge [10:35] Opening New Hubs: Reactive or Predictive? [11:42] Tariffs and Pricing: Just a Pass-Through [14:17] Vertical Integration and the FedEx Freight Spinoff [17:18] FedEx’s Network Moat [18:18] Amazon: Customer, Not Competitor [19:45] The Three Vectors of FedEx’s Growth [21:06] Two Petabytes a Day: AI and FedEx’s Data Advantage [23:20] Predictive AI and FedEx’s #1 Position in Healthcare [25:30] AI-Powered Customs Codes and Supply Chain Orchestration [26:27] FedEx’s New Deal with the US Army [27:43] Physical AI: Robots Loading Trucks and Driverless Trucks in Texas [28:45] Why AI Is Adding Jobs at FedEx, Not Cutting Them [29:13] Investing in Startups: FedEx as a Platform [32:06] Raj’s 35-Year Career at FedEx [34:35] Inside FedEx’s People-Service-Profit Culture [35:30] On Immigration and the American Dream [37:48] Global Mobility Inside FedEx [39:46] FedEx Cares: Delivering Vaccines and Oxygen During COVID
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