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Amazon Ships Outside Cargo to Compete with UPS, FedEx 

Amazon has begun shipping cargo for outside customers to compete with UPS and FedEx.  

According to a CNBC report on Monday (Sept. 6), Amazon’s first quarter earnings show an 80% rise in capital expenditures, which helped it boost the capacity of its logistic network by 50% from year to year. The retail giant is now shipping 72% of its own goods, compared to 46.6% two years ago, with a global transportation network that includes 400,000 drivers, 40,000 trucks, 30,000 vans and over 70 planes. 

“They want to be a new kind of U.S. Postal Service, where everything can get everywhere, but also quickly,” eCommerce consultant Chris McCabe, who was a seller performance investigator at Amazon from 2006 to 2012, told CNBC. 

Read more: Amazon Expands Same-Day Delivery Program 

In August, the company opened its $1.5 billion Amazon Air Hub in Kentucky. Around the same time, Amazon announced it was expanding its same-day delivery service to six new cities: Baltimore, Charlotte, Chicago, Detroit, Houston and Tampa. 

In June, the UPS has said it would explore a same-day delivery option, but so far it appears to just be a pilot project. 

Related news: UPS Dips Toes Into Same-Day Delivery 

Outside merchants already enjoy some shipping services from Amazon, such as the “logistics as a service” program the company operates in the U.K., which researchers at DePaul University predict will launch in the U.S. in the next 18 months. 

But while the company has begun moving cargo for the U.S. Postal Service, one researcher says Amazon won’t try to replicate all the services offered by UPS and FedEx. 

“They’re not going to be just this blanket carrier that will deliver whatever package that you want them to, to whatever address,” Dan Romanoff, who analyzes Amazon for Morningstar, told CNBC. “Amazon is sort of cherry-picking their routes. They want to run and sort the parcel sizes they want to deliver.” 

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