Amazon poised to drop USPS reliance and take full control of last-mile deliveries

[Shawn Knight]

The big picture: Amazon is reportedly preparing to expand its vast delivery network and end its reliance on the US Postal Service for last-mile parcel delivery. Should it come to fruition, the postal service would lose its largest customer and enter an era of true uncertainty.

Sources familiar with the matter told The Washington Post that Amazon has provided USPS with more than $6 billion in revenue this year. That equates to around 7.5 percent of the service's total revenue last year. It goes without saying that losing a source of revenue as substantial as that would be a huge hit to the agency, and could result in major restructuring.

Nothing has been finalized as of this writing and plans could still change. Discussions remain fluid, however, as Amazon CEO Andy Jassy reportedly met with Postmaster General David Steiner as recently as November 14 to discuss the matter.

The US Postal Service has been struggling for years thanks in part to competition from couriers like UPS and FedEx. The rise of digital communication, meanwhile, means people are corresponding less via snail mail than they once did. Even as service rates have risen, revenue has fallen. In 2022, the Postal Service Reform Act bailed the agency out financially to the tune of around $107 billion over the following decade.

Amazon has been hard at work building out its nationwide delivery service, starting with its own cargo airline service in 2015. The company cut ties with FedEx for its air delivery service in 2019. Today, Amazon conducts many of its own last-mile deliveries and even employs gig economy drivers for the same purpose.

Breaking from USPS would further allow Amazon to control nearly every aspect of the purchase and delivery process, and would be welcomed by those who have had negative experiences with USPS in the past. Indeed, it'd be far easier to deal directly with Amazon regarding a delivery dispute than having to contact the USPS.

Amazon's existing contract with the USPS is set to expire on October 1, 2026.

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Amazon poised to drop USPS reliance and take full control of last-mile deliveries

 

[IMABEARLOL]

The United States Postal SERVICE is not a business, it's a service that operates for the benefit of the citizens of the country. Companies have been exploiting it when it suits them, and now that they can push that exploitation on to delivery services that are contract workers made to buy Amazon branded trucks and only deliver for them they are moving on.

But painting the USPS as a failing business is wholey false and it is often done by those who want to cut government services so that they can be privatized and controlled so a few people get richer. It's purpose is so that every resident has equal access to message and parcel delivery, not to make a profit for the United States of America.

Comparing USPS to FedEx and UPS is like comparing the US Military to Raytheon and saying the military is failing because it's not turning a profit and Raytheon is.

That bailout was when disingenuous politicians forced the service to prepay all employee pensions all at once to frame the service as a enormous expense and operating failure in an effort to privatize it.

 

[Theinsanegamer]

The United States Postal SERVICE is not a business, it's a service that operates for the benefit of the citizens of the country. Companies have been exploiting it when it suits them, and now that they can push that exploitation on to delivery services that are contract workers made to buy Amazon branded trucks and only deliver for them they are moving on.

But painting the USPS as a failing business is wholey false and it is often done by those who want to cut government services so that they can be privatized and controlled so a few people get richer. It's purpose is so that every resident has equal access to message and parcel delivery, not to make a profit for the United States of America.

Comparing USPS to FedEx and UPS is like comparing the US Military to Raytheon and saying the military is failing because it's not turning a profit and Raytheon is.

That bailout was when disingenuous politicians forced the service to prepay all employee pensions all at once to frame the service as a enormous expense and operating failure in an effort to privatize it.

It's a self financing service, one that complains constantly when people actually use it.

Oh noes, Amazon is sending you more packages? Oh the horror, you have job security! Well guess what? Amazon heard you, and they'r enot going to use you anymore. Guess the USPS will enjoy losing a good chunk of revenue.

cutting government services? Are you from 1960? It's been 50 years since the USPS received any government funding. And they ARE perpetually fighting off being broke in order to pay for their own pensions. That is a straight up fact.

 

[toooooot]

I think people workingfor Amazon will have more and more reasons to unionize. If Amazon becomes pretty much the ONLY store/platform for everything, it should/must provide minimum standards for people working there.
They are pretty much becoming a monopoly. Certain standards and salaries should be guaranteed.

 

[IMABEARLOL]

I think people workingfor Amazon will have more and more reasons to unionize. If Amazon becomes pretty much the ONLY store/platform for everything, it should/must provide minimum standards for people working there.
They are pretty much becoming a monopoly. Certain standards and salaries should be guaranteed.

That's why Amazon delivery is setup like contractors / franchisees. The drivers have to take it up with the owner of the delivery franchisee, and how do the franchisees unionize? They are already contractually obligated and indebted.

 

[IMABEARLOL]

It's a self financing service, one that complains constantly when people actually use it.

Oh noes, Amazon is sending you more packages? Oh the horror, you have job security! Well guess what? Amazon heard you, and they'r enot going to use you anymore. Guess the USPS will enjoy losing a good chunk of revenue.

cutting government services? Are you from 1960? It's been 50 years since the USPS received any government funding. And they ARE perpetually fighting off being broke in order to pay for their own pensions. That is a straight up fact.

True, but self-financing service doesn't mean it has to profit or else like a business does.

Aside from the fundamental service it offers to all citizens, it also provide jobs and retirement to the citizens it employs.

Ideally, the service would pay for itself at all times, but if some public money was also used to ensure its operation as long as it wasn't being tampered with, sabotaged, or mismanaged then it is still an operating success.

By forcing it to pre-fund retirement funds while it was already struggling to adapt to modern communication taking over it has been framed as this massive failing business when it's a service that probably shouldn't have be used by corporations for their last-mile delivery who pay less than the individual US citizens it is supposed to operate for.

 

[Neatfeatguy]

Most amazon delivery drivers I come across are awful. Throw packages, leave them outside in the elements instead of inside when they should be actually coming inside a business to make a delivery....I'm not saying USPS is better, but at least the mail carries I see bring packages inside and don't throw them.

 

[zmac55cifi2025]

And how much money congress skims off each year. It was 6 billion. Could your business run a profit with that being done.
Don't think so.

 

[ZedRM]

This will be counted as one of Amazon's less smart moves.

 

[alph1171]

I'd like to know how this affects rural deliveries. We don't get Amazon trucks where we live. Everything out here comes UPS or USPS. I'd like to see Amazon expand their own fleet enough so we could actually get our stuff in the same, or even 2 day delivery Prime is supposed to provide.