FedEx executives have been meeting with President Donald Trump about playing a part in the White House’s push for public-private partnerships to help fund $1 trillion in spending to overhaul the nation’s infrastructure systems, including airports, a source told CNBC’s Jim Cramer.
“The president has met and is meeting with the people who run FedEx,” Cramer said on “Squawk on the Street” on Monday, citing a source. “I think you’re going to hear, and this is my reporting, that FedEx is going to be involved with the privatization of airports.”
“That’s a very good reason to own FedEx beyond the numbers,” Cramer argued, saying FedEx reports earnings later this month. “I think it will be a good quarter.”
Airports are the low-hanging fruit for investors looking to capitalize on the expected U.S. infrastructure boom, saidGlenn Youngkin, the president and COO of private equity giant The Carlyle Group, in a “Squawk Box” interview last month.
Under a 1996 law, the Federal Aviation Administration can approve up to 10 pilot airport privatization projects.
“Airports, right out of the box, is the No. 1 target area right now. Why? Because they’re an understood commercial entity. And there are airports starting to move this way,” Youngkin said.
Last week, President Trump urged Congress to privatize the U.S. air traffic control system, saying it would make U.S. airports more efficient.
FedEx told CNBC in a statement:
“We are pleased that the proposed budget lays solid groundwork for infrastructure modernization and an independent, non-governmental air traffic control system that will allow more flights to operate safely in congested air space and at crowded U.S. airports. While FedEx strongly supports the need for funding an updated and improved system, it is also essential that the cost accounting going forward reflect airline usage, which is a key indicator for system maintenance and growth.”
The White House was not immediately available to respond to CNBC’s request for comment on Cramer’s reporting.
— Reuters contributed to this report.
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