FedEx Ends Its Long-Running Partnership With Amazon

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Behind USPS, or the United States Postal Service, the United Parcel Service or UPS, legally known as the United Parcel Service, Inc., is the largest delivery services provider in all of the United States in terms of annual revenue, narrowly inching out FedEx, formally recognized as the FedEx Corporation. UPS reeled in some $71.861 billion in revenue for the financial reporting year ending Dec. 31, 2018, its most recent annual revenue count as of the time of publication of this article. FedEx, on the other hand, generated $69.693 billion in revenue for its most recent annual reporting period, which closed on May 31, 2019. It’s also worth noting that UPS has reported greater net income than FedEx in each of the past four years.

Earlier today, on Wednesday, Aug. 7, 2019, FedEx shared with the world that it would no longer be carrying Amazon’s packages to consumers as of the end of this month, per an official statement that the company released via its own website and several well-established, trusted press release distribution channels.

In particular, FedEx will be letting its ground shipment contract with Amazon, the primary means through which FedEx has delivered Amazon’s packages to consumers throughout the United Sates.

Two months ago, in June, FedEx announced that it would no longer be carrying Amazon’s packages through its air cargo channels.

If you’re familiar with Amazon or FedEx – in other words, if you’ve purchased anything through Amazon in the past few years – you know that Amazon’s packages are delivered exclusively through FedEx. Considering that Amazon is the world’s largest e-commerce retailer, you might be led to believe that FedEx is in big trouble because it will soon be losing the exclusive rights to carry all of Amazon’s packages throughout the United States and deliver them to consumers. However, what’s true is that Amazon deliveries only accounted for about one percent of all revenue generated by FedEx. In other words, the loss of business that FedEx will experience as a result of voluntarily giving up the exclusive right to ship Amazon’s packages really doesn’t mean that much to the company.

It’s been said that because Amazon requires FedEx to deliver all of its packages to consumers throughout the United States in one to two days, FedEx has been forced to allocate tons of resources to deliver Amazon’s packages. This means that FedEx makes a lot more profit from delivering parcels to consumers throughout the United States that aren’t associated with Amazon.

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