
Amazon is ready to launch its own delivery service to businesses that will compete directly with UPS and FedEx. The new service will be called Shipping with Amazon, and will retrieve packages from businesses and ship them directly to consumers. The service will begin operations in Los Angeles and grow from there. Laura Stevens reports for The Wall Street Journal:
While the program is being piloted with the companyโs third-party sellers, it is envisioned to eventually be opened to other businesses too, according to some of the people. Amazon is planning to undercut UPS and FedEx on pricing, although the exact rate structure is still unclear, these people said.
The new service, which stems from a Los Angeles pilot projectย first reported by The Wall Street Journalย more than a year ago, moves Amazon into direct competition for parcel business currently handled by delivery partners UPS and FedEx. โShipping With Amazonโ was previously tested and rolled out in London.
It is the latest move by Amazon to create its own freight and parcel delivery network. In the last couple of years, Amazon has expanded intoย ocean freight, built a network of its own drivers who can nowย deliver inside homesย and leased up to 40 aircraft while establishingย an air cargo hub.
Amazon already delivers some of its own orders in at least 37 U.S. cities. With the new โShipping with Amazonโ option, Amazon plans to send drivers to pick up shipments from warehouses and businesses itself and deliver the packages when it is able, the people said. For shipments outside Amazonโs delivery reach, the U.S. Postal Service and other carriers will take care of the so-called last mile to customersโ doorsteps.
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