Amazon is reportedly considering discontinuing use of the US Postal Service and building out its own shipping network to rival it, according to The Washington Post. The e-commerce behemoth spends more than $6 billion a year on the public mail carrier, representing just shy of 8 percent of the service's total revenues. That's up from just shy of $4 billion in 2019, and Amazon continues to grow.
However, it sounds like that split might be due to a breakdown in negotiations between Amazon and the USPS rather than Amazon proactively pullings its business. Amazon provided Engadget with the following statement regarding the Post's reporting and its negotiations with the USPS:
"The USPS is a longstanding and trusted partner and we remain committed to working together. We’ve continued to discuss ways to extend our partnership that would increase our spend with them, and we look forward to hearing more from them soon — with the goal of extending our relationship that started more than 30 years ago. We were surprised to hear they want to run an auction after nearly a year of negotiations, so we still have a lot to work through. Given the change of direction and the uncertainty it adds to our delivery network, we're evaluating all of our options that would ensure we can continue to deliver for our customers."
The auction Amazon is referring to would be a "reverse auction," according to the Post. The USPS would be offering its mailing capabilities to the highest bidder, essentially making Amazon and other high-volume shippers compete for USPS resources. This move would reportedly be a result of the breakdown in talks between Amazon and the USPS.
Over the past decade, Amazon has invested heavily in shipping logistics, buying its own Boeing planes, debuting electric delivery vans and slowly building out a drone delivery network. Last year, Amazon handled over 6.3 billion parcels, a 7 percent increase over the previous year, according to the Pitney Bowes parcel shipping index. USPS, for its part, handled roughly 6.9 billion, just a 3 percent increase over 2023. That is to say that Amazon's shipping network can already handle over 90 percent of the volume of the US Postal Service (at least by sheer numbers).
The USPS has been in dire financial condition for some time, losing billions of dollars a year. Negotiations between Amazon and the public carrier have reportedly stalled, which, together with the agency's need to keep raising its prices, may create more urgency for the company to eliminate its reliance on the service altogether.
The Postal Service has struggled to modernize and adapt (its attempt to electrify the truck fleet was a bust) in a market where the likes of Amazon and Walmart are investing billions in delivering packages around the country at lightning speed. The ever-accelerating digitization of communication and heavy investment in privately owned shipping operations threatens the very existence of one of the country's greatest public goods.
Update, December 4, 2025, 2:24PM ET: This story has been updated with a statement from Amazon and more details about the "reverse auction" the USPS reportedly wants to conduct if it no longer works with Amazon.
This article originally appeared on Engadget at https://www.engadget.com/big-tech/amazon-reportedly-considering-ending-ties-with-the-us-postal-service-144555021.html?src=rss