Amazon is happening the defensive after a report from The Wall Road Journal revealed that the ecommerce big plans to slash shipments with america Postal Service, which stated this week that it’s working out of cash. In a prolonged assertion printed on Wednesday, Amazon says it didn’t wish to scale back shipments with the USPS, and that negotiations solely stalled after the USPS “abruptly walked away” from negotiations for a brand new contract.
As reported by the WSJ, Amazon plans to chop packages despatched by means of the USPS by at the very least two-thirds by this fall, across the identical time its contract with the unbiased federal company is ready to run out. Amazon claims it’s been working with the USPS for over a yr on a deal “that will carry them billions in income,” however the company walked away on the “eleventh hour” throughout negotiations final December.
Whilst Amazon invests billions in constructing out a sprawling community of supply and logistics providers, it nonetheless works with the USPS for last-mile deliveries — or the ultimate leg of a cargo — particularly in rural areas. The WSJ says the USPS presently handles round 30 to 40 % of Amazon deliveries in additional distant areas, the place delivery prices are greater, and the place the USPS has a mandate to ship six days per week. However large companies like Amazon reportedly get discounted charges on delivery with the USPS, one thing the company is not negotiating with companies individually, in accordance with the WSJ. The supply mandate, coupled with discounted charges for giant shippers, has dealt a blow to the USPS’s funds.
As a part of efforts to shore up income, the USPS carried out a brand new bidding course of for last-mile deliveries. “There’s just one factor I’m completely sure of — if we proceed to do issues the way in which we’re doing it at the moment, we’re lifeless in a couple of yr, and so I’ve bought to exit and check the market on this value to seek out out if it’s a good value,” Postmaster Normal David Steiner advised Reuters final yr.
Throughout a listening to on Tuesday, Steiner reiterated that the USPS will run out of cash in lower than a yr if Congress doesn’t enable it to borrow additional cash and lift the worth of postage. “One simple motion, growing our borrowing authority, buys us time… Time that we will use to greatest decide what the Postal Service ought to do to greatest serve the American public,” Steiner stated, in accordance with The New York Occasions.
Amazon says it has “repeatedly requested engagement” with Steiner, and that the corporate “acquired no response” to the bid it submitted in February 2026. “We’ve submitted a bid as a part of their new public sale idea and hope to proceed our partnership, even at a diminished degree,” Amazon’s assertion says. “Nevertheless, with out long-term certainty, we now have to arrange to fulfill our prospects’ supply wants whatever the final result of the public sale.”
Steiner advised Reuters that the USPS delivers round 1.7 billion Amazon packages every year. He added that he would “like to proceed” the company’s relationship with Amazon however “at a good value.” The USPS didn’t instantly reply to a request for remark.
