Amazon is spending over $4 billion to boost small-town deliveries
The company already accounts for more than one-quarter of US parcel volumes.
Yesterday, Amazon announced that it’s doubling down on small-town America, revealing plans to invest more than $4 billion into its delivery service in rural locations by the end of next year, as it attempts to speed up delivery times across less populated areas.
The announcement — which came a day before the company’s earnings, expected after the bell today — was packed with big-if-true figures. For example, the expansion will apparently let Amazon ship over 1 billion extra packages a year, add 200 delivery stations, create 100,000 new jobs, and improve its service in more than 13,000 rural ZIP codes across more than 1.2 million square miles.
Boxing match
Elsewhere in the delivery business, UPS said on Tuesday that it would be cutting 20,000 positions (~4% of its workforce) in 2025 and closing 73 US locations by the end of June. While some jumped to tariffs as a potential explanation, the layoffs are more a result of UPS distancing itself from Amazon. The company is planning to halve the business it does with the online giant by mid-2026, with CEO Carol Tome explaining that fulfilling outbound shipments from Amazon centers “is not profitable for us, nor a healthy fit for our network.”
As Jeff Bezos’ retailer looks to bolster its parcel force where others are pulling back, it’ll likely carry on a yearslong trend and only pull further ahead of of its competition in the logistics industry.
According to the annual Pitney Bowes Parcel Shipping Index, Amazon Logistics delivered a whopping 6.3 billion parcels across the US in 2024, up 7.3% from the year before and second only to the US Postal Service’s 6.9 billion figure. Amazon now looks clear as the biggest private delivery business in America, taking an impressive 28% share of the market, while UPS and FedEx have both declined in recent years.
