November 29, 2023 – According to a report from The Wall Street Journal, Amazon has now emerged as the largest courier company in the United States, surpassing both UPS and FedEx in parcel volume.
Recent internal data from Amazon reveals that the e-commerce giant has, for the first time, exceeded its competitors in annual delivery volume in the United States. It is anticipated to ship a total of 4.8 billion packages before Black Friday and Cyber Monday, with an estimated year-end total of around 5.9 billion packages in 2023. In comparison, UPS handled approximately 3.4 billion packages in the first nine months of this year in the U.S., and the projected total for 2023 is not expected to exceed last year’s 5.3 billion. FedEx, with a smaller parcel volume in the U.S., includes packages handed over to the United States Postal Service for final delivery.
According to Amazon’s internal data and insider sources, the Seattle-based e-commerce giant surpassed UPS in the number of packages delivered to U.S. households in 2022, and it had already surpassed FedEx in 2020. This year, Amazon is poised to further expand its lead. In terms of quantity, the United States Postal Service remains the largest parcel service provider, handling hundreds of millions of packages for these three companies.
As Amazon’s market share in the courier industry continues to grow, FedEx and UPS have indicated in recent years that they are not competing for package volume but are focusing on transporting more profitable parcels. In 2019, FedEx severed ties with Amazon, with Amazon accounting for approximately 11% of UPS revenue.
A decade ago, Amazon was a significant customer for both UPS and FedEx. The idea of Amazon becoming the largest courier company was once considered absurd by CEOs in the logistics industry. In 2016, Fred Smith, the former CEO of FedEx, denied the possibility of Amazon becoming a logistics giant, calling it a “fantasy.” Smith stated, “In the foreseeable future, the primary carriers for e-commerce packages will be UPS, the U.S. Postal Service, and FedEx.”
At the time of Smith’s comments, Amazon lagged far behind UPS and FedEx in the courier market. However, in the following years, the company established one of the world’s largest logistics networks, closing the gap.
In 2018, Amazon launched a program allowing entrepreneurs to obtain a franchise for Amazon package delivery for as little as $10,000. The program, boasting around 200,000 drivers in the United States, rapidly increased the number of packages Amazon could deliver daily.
