Mon. Apr 22nd, 2024

UPS to replace FedEx as U.S. Postal Service’s primary air cargo provider

April 1, 2024

READ FULL ARTICLE AT » Reuters

April 1 (Reuters) – United Parcel Service will become the United States Postal Service’s (USPS) primary air cargo provider, the company said on Monday, as rival FedEx announced an end to its more than 20-year partnership with the postal service provider.
USPS was the largest customer for FedEx’s air-based Express segment, even as payments declined after the postal service shifted letters and packages from planes to more economical trucks as part of an operational revamp.
“It’s not a huge loss for FedEx, but it will impact their density… You’re losing consistency in terms of revenue from a pretty significant partner, but it wasn’t the most profitable business for them … it’s not all negative,” said Faisal Hersi, an equity analyst at Edward Jones.
USPS represented just about 4% of Express’ annual revenue, according to a Reuters calculation.
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