Amazon's delivery network expansion positions it as a leader in the US parcel market, ahead of key contract negotiations with USPS.
Amazon's expanding fulfillment and delivery network is solidifying its role as a dominant force in the US parcel sector, particularly as it prepares for contract negotiations with the US Postal Service (USPS), reports Reuters.
The company is currently reviewing options for its relationship with USPS ahead of the contract expiration next year. This strategic move comes as the nearly $193 billion US parcel market continues to grow, with Mordor Intelligence projecting it will reach $239.38 billion by 2030.
According to data from Pitney Bowes, Americans shipped 22.37 billion parcels in 2024, with Amazon delivering 6.3 billion parcels, closely trailing USPS at 6.9 billion. Last year, Amazon surpassed UPS and FedEx in parcel volumes and is forecasted to overtake USPS by 2028, with an estimated 8.4 billion deliveries.
In 2024, Amazon held a 15.3 percent revenue share, just behind USPS at 15.8 percent. This growing scale coincides with a retreat in its partnership with UPS, which plans to reduce the volume handled for Amazon by more than half by 2026.
The sector is currently facing policy uncertainty, particularly after President Donald Trump indicated in February that he was considering folding the loss-making USPS, which reported a $9.5 billion deficit last year, into the Commerce Department. Meanwhile, Amazon has committed more than $4 billion to expand its rural delivery network by the end of next year.
