Amazon Aims to Distance Itself from Postal Service Struggles

Amazon is taking a stand after a report indicated that the company intends to significantly reduce its shipments with the United States Postal Service (USPS), which recently announced financial troubles. In a detailed statement, Amazon expressed that it did not wish to cut ties with the USPS, claiming that negotiations fell through when the USPS “abruptly walked away” from discussions for a new contract.

According to the report, Amazon aims to decrease the number of packages sent via USPS by at least two-thirds by this fall, coinciding with the expiration of its current contract with the agency. Amazon stated it had been negotiating with the USPS for over a year on a deal that could have generated billions in revenue, but the USPS exited negotiations unexpectedly last December.

Despite Amazon’s substantial investments in its own delivery and logistics network, it still relies on the USPS for last-mile deliveries, particularly in rural areas. The USPS currently manages about 30 to 40 percent of Amazon’s deliveries in these remote locations, where shipping costs are higher and the USPS is required to deliver six days a week. However, large companies like Amazon typically receive discounted shipping rates from the USPS, which the agency is no longer willing to negotiate individually, contributing to its financial struggles.

To address its revenue issues, the USPS has introduced a new bidding process for last-mile deliveries. Postmaster General David Steiner emphasized the urgency of the situation, stating that if the USPS continues its current practices, it could face financial collapse within a year. He mentioned that increasing borrowing authority could provide the agency with the necessary time to reassess its operations to better serve the public.

Amazon has stated that it has “repeatedly requested engagement” with Steiner but has not received a response to its bid submitted in February 2026. The company expressed hope to maintain its partnership with the USPS, even at a reduced capacity, but acknowledged the need to prepare for customer delivery demands regardless of the auction’s outcome.

Steiner noted that the USPS delivers approximately 1.7 billion packages for Amazon each year and expressed a desire to continue the relationship, provided it is at a fair price. The USPS has not yet commented on the situation.