Amazon switches from UPS to FedEx for package deliveries
Amazon has announced a remarkable new partnership with the logistics company FedEx, which is set to take effect in the second half of 2025. Under this agreement, the e-commerce giant plans to use FedEx for 100 percent of all capacity risks in package deliveries, thereby replacing its previous partner UPS in this segment.
Reasons for the Decision
This strategic decision by Amazon is based on several factors: FedEx offers cost advantages compared to UPS and can help mitigate capacity constraints more effectively. Amazon’s Extra-Large-Delivery network, which specializes in particularly large and heavy packages, is expected to benefit significantly. The integration of FedEx will occur as part of a multi-carrier model alongside other service providers such as USPS and Amazon’s own delivery network to ensure optimal customer service.
Positive Market Reaction
The market’s reaction to this partnership has been positive: Amazon’s stock rose by more than 8 percent, while FedEx’s stock gained nearly 7 percent. Industry experts see this step not only as a tactic to optimize the supply chain but also as an increasing independence of Amazon from individual service providers, which could increase competitive pressure on smaller package delivery services and potentially change the logistics industry in the long term.
Implications for the German Logistics Sector
For investors in DAX companies, this development could be relevant as it may impact the entire logistics and supply chain sector. In particular, German logistics providers could face pressure from the expansion of Amazon’s multi-carrier model or may receive new cooperation opportunities. Additionally, Amazon plans to introduce further improvements in Germany regarding deliveries to offer same-day deliveries in more cities and to enable evening deliveries, which is likely to further increase pressure on logistics service providers.