AMERICAN multinational courier delivery provider, FedEx is dropping a contract for air shipment of packages for Amazon within the US, reducing its ties with the online retail giant that is already expanding its own delivery service
AMERICAN multinational courier delivery provider, FedEx is dropping a contract for air shipment of packages for Amazon within the US, reducing its ties with the online retail giant that is already expanding its own delivery service. In a statement, FedEx said it will not renew the contract when it expires June 30,
Amazon is under increased pressure to deliver packages quickly. In April, Amazon said it planned to begin delivering packages to Prime customers in one day rather than two. FedEx followed up in May with plans to deliver seven days a week, reported CNN.
FedEx said in a press release it plans to focus on serving the broader e-commerce market with continued partnerships with brands such as Walmart and Target. The company said Amazon accounted for less than 1.3 per cent of its total revenue in 2018.
A FedEx spokeswoman told CNN Business the decision impacts only air transportation. Other contracts between FedEx and Amazon remain intact.
'We respect FedEx's decision and thank them for their role serving Amazon customers over the years,' Amazon said in a statement.
The two companies increasingly compete across several areas. For example, both companies are developing autonomous ground robots that drive on sidewalks to deliver packages in neighbourhoods. Earlier this week, Amazon unveiled its latest drone that is months away from making deliveries.
Amazon also has said it will invest US$1.5 billion in a hub for its cargo planes near Cincinnati.
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