(NewsNation) — Amazon announced this week it is planning to make substantial cuts to the number of packages it ships through the U.S. Postal Service.
Amazon is aiming to cut the shipments by at least two-thirds by September, when its contract expires with the USPS. The new development follows the e-commerce giant’s already reduced postal shipments.
“I couldn’t tell you where that’s going to end,” U.S. Postmaster General David Steiner said.
Steiner also acknowledged that the USPS could be cashless within a year, or even by October, if it makes the required retirement payments.
Amazon and USPS have been negotiating for over a year to extend their relationship. Two months ago, the USPS started taking proposals for access to its last-mile delivery network and opened more than 18,000 destination delivery units and local processing centers nationwide.
“We negotiated with [the Postal Service] in good faith for over a year to try and reach a deal that would bring them billions in revenue and believed we were heading toward an agreement, when the USPS abruptly walked away at the 11th hour and introduced the auction concept,” an Amazon spokesperson said.
“While we’ve submitted a bid and hope to continue our partnership, even at a reduced level, we now have to prepare to meet our customers’ delivery needs regardless of the outcome of the auction.”
Last year, the USPS delivered over a billion packages for Amazon, accounting for nearly 15% of all packages the USPS delivered across the U.S.
