Amazon cuts off FedEx ground

Amazon won’t be relying on FedEx ground delivery for its Prime shipments through the holidays. Thomas Samson/AFP via Getty Images

Amazon.com says FedEx’s delivery performance is slipping and will no longer let third-party merchants use the company’s ground delivery network for quick Prime shipments through the holidays.

Amazon sent a message to sellers Sunday night instructing them of the change, according to Amazon notifications sent to merchants reviewed by Bloomberg.

More than half of all products sold on Amazon come from third-party merchants who pay Amazon commissions on each sale. Many of those merchants also pay Amazon for logistics services like warehousing and delivery, which puts Amazon in competition with FedEx.

Sellers can oversee deliveries on their own, and many use FedEx ground to meet Amazon’s delivery pledge of one or two days for millions of products. Sellers can still use FedEx’s express service for Prime packages, but that’s a costly option.

Amazon examines its delivery providers’ performance each year to determine order cut-off times for the holidays.

FedEx, in an emailed statement, said “the overall impact to our business is minuscule.” The company’s shares fell 2.4% at 3:12 p.m. in New York.

Some Amazon sellers complained about receiving short notice for the change less than two weeks before Christmas when holiday spending is peaking. Their alternatives include UPS ground.

The Wall Street Journal reported the news earlier.

WPBloom

Recommended for you

(1) comment

rdsouth

My Amazon deliveries usually come by UPS or USP, but the one time they sent a package by Fed Ex I never got it. I complained to Amazon and asked them to never send me anything by Fed Ex again. They claimed it must have been porch pirates and made me buy a stack of books again if I wanted to get them. How come porch pirates never steal my UPS packages, they picked on just this one?

Welcome to the discussion.

Keep it Clean. Please avoid obscene, vulgar, lewd, racist or sexually-oriented language.
PLEASE TURN OFF YOUR CAPS LOCK.
Don't Threaten. Threats of harming another person will not be tolerated.
Be Truthful. Don't knowingly lie about anyone or anything.
Be Nice. No racism, sexism or any sort of -ism that is degrading to another person.
Be Proactive. Use the 'Report' link on each comment to let us know of abusive posts.
Share with Us. We'd love to hear eyewitness accounts, the history behind an article.