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USPS Risks Amazon Split Over New Delivery Plans
24 Dec
Summary
- USPS faces potential cash shortage within 12-24 months.
- Amazon contract reportedly generates $6 billion annually for USPS.
- USPS plans to auction last-mile services, risking Amazon's partnership.
The US Postal Service is considering opening its lucrative last-mile delivery services to new clients in an attempt to offset billions in ongoing financial losses. This strategic shift, aimed at securing additional revenue streams, carries a significant risk of alienating its most valuable customer, Amazon.
The agency has reported substantial deficits, with $9 billion lost in the twelve months prior to September. USPS officials have expressed concern over their financial stability, indicating a potential cash shortage within the next 12 to 24 months without intervention. While cost-cutting measures are in place, they are deemed insufficient to resolve the deep-seated financial challenges.
USPS plans to solicit bids from other shipping companies for access to its distribution centers. Amazon, a partner for over 30 years, has expressed surprise at this development and is evaluating its options, which could include significantly reducing its reliance on USPS. This situation highlights the delicate balance the postal service must strike between financial necessity and maintaining crucial partnerships.
