A current change in how the US Postal Service handles delivery companions seems to have compelled Amazon to make various plans. The corporate reportedly plans to chop the variety of packages it ships by USPS by not less than two-thirds later this 12 months. It says the choice got here after USPS ended negotiations “on the eleventh hour” in favor of a brand new bidding course of.
On Tuesday, the Wall Road Journal reported that Amazon plans to cut back the shipments it arms off to USPS. Final 12 months, the corporate accounted for almost 15 % of the Postal Service’s package deal deliveries. Chopping that by almost two-thirds diminishes one of many USPS’s most dependable sources of income. In fiscal 2025, the company reported a web lack of $9 billion.
Amazon’s present contract with USPS ends on September 30. In a public response to the WSJ story, the corporate mentioned it notified USPS in October 2025 that it could want to finish a brand new deal by December. “You’ll be able to’t add capability for lots of of hundreds of thousands of packages in a single day — it requires main capital funding, long-term infrastructure planning, hiring, and logistics coordination,” Amazon wrote.
In accordance with Amazon, USPS then pulled the plug on negotiations on the final second. “We negotiated with [USPS] in good religion for greater than a 12 months to achieve a deal that might convey them billions in income and believed we have been heading towards an settlement,” Amazon wrote in an announcement. “Our objective was to extend our volumes with USPS, not cut back them — till USPS abruptly walked away on the eleventh hour in December.”
Postmaster Normal David Steiner (AP Photograph/Cliff Owen, File) (ASSOCIATED PRESS)
That’s when Postmaster Normal David Steiner carried out a brand new bidding course of for last-mile deliveries, changing a long-established one the place USPS negotiated with delivery companions individually. He described the transfer as “a good bidding course of that allows {the marketplace} to search out the most effective mixture of native delivery attributes for the most effective volume-driven pricing.” Steiner was appointed to the put up in Might 2025, following the departure of former head Louis DeJoy.
Amazon mentioned it submitted a bid in February utilizing the brand new system however hasn’t heard again. “This creates important uncertainty for our long-term community planning,” the corporate mentioned. “Regardless of this, we participated in good religion and submitted a bid in February 2026. We have acquired no response.”
USPS plans to announce the bidding ends in Q2 2026. Contracts are anticipated to be finalized by Q3. Regardless of apparently shifting ahead with the contingency plan, Amazon mentioned it’s nonetheless “able to proceed this partnership.”
As for Postmaster Steiner, he spent Tuesday asking Congress to loosen USPS rules and let him elevate costs. Warning that the company will “run out of money” in a couple of 12 months, he informed a Home subcommittee that he desires to lift the company’s present $15 billion debt cap. He additionally requested for the flexibility to extend postage costs and reform its retiree pension obligations.
