HR Geo Services Specialist

Amazon will have FedEx deliver large packages to the retailer’s customers for the first time in six years.The companies reached a multiyear agreement that renews a relationship that ended in 2019, Bloomberg reported Monday (May 12).The deal follows a January announcement by UPS that it will cut the number of packages it delivers for Amazon by half by the end of next year, according to the report.Amazon said in the report that it does not plan to use FedEx to replace the business it still does with UPS; instead, FedEx will serve as one of several third-party partners that deliver to the retailer’s customers, per the report.“FedEx joins our other third-party partners like UPS and the USPS, that work alongside our own last mile delivery network to help us balance capacity to best serve customers,” Amazon spokesman Steve Kelly said in the report.Amazon’s own logistics network, which is made up of small businesses, delivers more than two-thirds of the retailer’s packages, according to the report.A FedEx spokesperson said in the report: “We have reached a mutually beneficial, multiyear agreement to provide residential delivery of select large packages for Amazon.”UPS said April 29 that it was accelerating its planned volume reduction from Amazon, a longtime major customer, as part of UPS’ pivot away from low-margin, high-volume accounts and toward more profitable business.Amazon’s insourcing of logistics has been an industrywide headwind, and UPS’ proactive recalibration could be a prudent step toward margin expansion, even if it results in near-term revenue pressure, PYMNTS reported at the time.FedEx said in August 2019 that it planned to conclude its ground-delivery contract with Amazon and would not renew it. The logistics company had already ended its express U.S. shipping contract early that summer.“This change is consistent with our strategy to focus on the broader eCommerce market, which the recent announcements related to our FedEx Ground network have us positioned extraordinarily well to do,” a spokesperson for FedEx said at the time.News had surfaced in June 2019 that FedEx would not be renewing its express U.S. contract with Amazon, calling the move a strategic decision

Amazon said Wednesday (April 30) that it will invest over $4 billion to expand its rural delivery network and provide faster delivery to millions of customers in less densely populated areas.The investment will expand Amazon’s rural delivery network to over 200 delivery stations, create over 100,000 new jobs and enable the retailer’s network to deliver over a billion packages each year to customers in more than 13,000 ZIP codes, Udit Madan, senior vice president, Amazon Worldwide Operations, said in a Wednesday blog post.“At a time when many logistics providers are backing away from serving rural customers because of cost to serve, we are stepping up our investment to make their lives easier and better,” Madan said in the post.Amazon opened its first rural delivery station in 2020, began scaling its small-town delivery network in 2023 and has accelerated its average delivery speeds by 50%, according to the post.“By the end of 2026, we’ll have tripled the size of our rural delivery network, to provide Prime members from Milton, Florida, to North Pole, Alaska, (and thousands of small towns and rural communities in between) the ability to shop from over 300 million items from the convenience of their homes and receive their packages even faster — cutting average delivery times in half,” Madan said in the post.It was reported that Amazon was ramping up its logistics expansion efforts by acquiring industrial property and restructuring its distribution network to speed delivery and reduce costs.At the time, the company had leased, bought or announced plans for over 16 million square feet of new warehouse space in the U.S. in the first five months of 2024, adding to its existing footprint of about 413 million square feet of industrial real estate across the country.UPS said Tuesday (April 29) that it was accelerating its planned volume reduction from Amazon, long a major customer, and now expects to slash Amazon package volume in its network by more than 50% by June 2026.UPS executives said the decision reflects UPS’ pivot away from low-margin, high-volume accounts and toward more profitable business