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In brief: The U.S. Postal Service (USPS) generated a huge $1.6 billion in profit from Amazon deliveries in the 2019 fiscal year, debunking claims from President Trump that the service loses money on Amazon shipments. Meanwhile, Amazon has been building up its own delivery logistics, accounting for nearly half of all deliveries, and consequently reducing its reliance on USPS, dropping from 60 percent to less than 35 percent of all packages delivered.
The information comes from internal emails and financial statements obtained by the American Oversight watchdog group and shared in a report from the Washington Post. According to the information, USPS delivered 1.54 billion Amazon packages in the 2019 fiscal year, amounting to 30 percent of the company’s volume.
President Trump recently criticized Amazon and CEO Jeff Bezos, claiming that USPS loses money whenever Amazon ships a package to a customer. Trump also claimed that USPS “have to” raise their prices for delivering packages for Amazon.
President Trump says the U.S. Postal Service "have to" raise prices for delivering packages for Amazon.— Bloomberg (@business) August 17, 2020
USPS has become a focal point for Congress and the 2020 election https://t.co/sCnjaLeWXv pic.twitter.com/OBMxnYS1rl
The leaked documents, however, indicate that USPS does make a profit on Amazon shipments. In some cases, this income is quite significant – combined, it stands at $1.6 billion in profit (out of $3.9 billion in revenue) for the 2019 fiscal year.
Meanwhile, Amazon has been building up its own logistics arm: in June last year, we heard that Amazon Logistics was delivering some 48 percent of its own packages. At the time, the USPS’s contribution had dropped from 60 percent to 35 percent. The share of UPS and FedEx, who delivered fewer packages for Amazon, stayed the same at 16.5 and 1.6 percent, respectively.