UPS and FedEx Trailing Behind: Amazon Emerges as Top US Delivery Service

In recent years, Amazon has emerged as the dominant force in the US delivery landscape, surpassing both UPS and FedEx in parcel volume. The e-commerce giant has overtaken UPS in 2022 and FedEx back in 2020, as reported by The Wall Street Journal, citing internal Amazon data from undisclosed sources close to the matter.

However, despite Amazon’s surge, the US Postal Service remains the largest parcel service, handling shipments not only for Amazon but also for UPS and FedEx.

Leading up to the shopping frenzy of Black Friday and Cyber Monday, Amazon had already delivered a staggering 4.8 billion packages within the US alone, as per The Journal. Forecasts suggest that Amazon is on track to reach approximately 5.9 billion deliveries by the close of 2023, marking a substantial 13.5% increase from the previous year’s total of 5.2 billion packages.

On the other hand, UPS indicated that its domestic deliveries are unlikely to surpass last year’s 5.3 billion. Reports from The Journal in September revealed that UPS had handled around 3.4 billion parcels domestically.

For FedEx, their Express and Ground parcel volume reached roughly 3.05 billion for the fiscal year ending May 31, 2023. It’s worth noting that the figures for both UPS and FedEx encompass packages they hand over to the US Postal Service for final delivery.

In contrast, Amazon’s figures only include packages they ship entirely from start to finish, as highlighted by The Journal.

Despite severing ties with Amazon in 2019, FedEx still has a partnership with UPS. Approximately 11% of UPS’s revenue is attributed to their collaboration with Amazon.

A spokesperson from UPS emphasised the significance of their association with Amazon, describing it as mutually beneficial and including agreements on package delivery volumes. They highlighted UPS’s focus on delivering more profitable parcels to customers who derive the most value rather than solely aiming for high package-delivery volumes.

The dynamics in the delivery landscape reflect Amazon’s ascendancy and strategic shifts in UPS and FedEx’s approaches to meet evolving market demands while ensuring profitability in a rapidly changing industry.