Amazon has re-entered a partnership with FedEx to alleviate delivery gaps left by UPS, which announced cuts to its services. A recently obtained document revealed the deal, made in late February, brings cost advantages for Amazon compared to UPS. Despite past tensions between FedEx and Amazon, who initially parted ways due to competition in 2019, Amazon views this collaboration as crucial for addressing capacity constraints. FedExâs stock rose following the news, indicating market optimism about the partnership's impact on operations. Amazon now aims to leverage multiple third-party logistics providers to enhance service delivery.
Securing FedEx capacity is our primary solution for these capacity constraints, underscoring how this partnership is crucial for Amazon's ability to manage delivery challenges.
We've reached an agreement with FedEx to serve as one of several third-party partners to deliver packages to our customers, highlighting the strategic importance of diverse logistics partners.
The renewed alliance between Amazon and FedEx surprises many, especially since their previous partnership ended due to rising competition and a shift in focus from FedEx.
This new deal gives Amazon cost favorability compared to UPS, which will help them save money while handling package deliveries during peak times.
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