UPS Replaces FedEx as Major Air Cargo Supplier for USPS

It is the start of a brand new partnership between the U.S. Postal Service and UPS — however it ends a long-term relationship with rival service FedEx.

The USPS mentioned on Monday that UPS would now be its main air cargo supplier after FedEx had stood within the place for over twenty years.

“This award is efficient instantly and enormously expands the present relationship between the 2 organizations,” UPS mentioned in a firm launch. “Following a transition interval, UPS will develop into the USPS’s main air cargo supplier and transfer nearly all of USPS air cargo within the US.”

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UPS known as the partnership with the USPS “mutually useful” because it goals to clean out each group’s already “built-in community.”

The precise monetary phrases of the brand new partnership haven’t been publicly disclosed, however Reuters reported that UPS famous the worth was “important.”

The outlet additionally famous that FedEx had made an estimated $2 billion yearly from its contract with the USPS.

FedEx, in the meantime, mentioned on Monday in a securities submitting that they have been “unable to achieve settlement on mutually useful phrases to increase the contract” and that it might make changes to make up for the loss.

In This fall 2023 earnings, UPS reported consolidated revenues of $24.9 billion, down considerably (7.8% roughly) from the $27 billion it introduced in on the similar time final 12 months.

Quarterly consolidated working revenue got here in at $2.5 billion in This fall, a 22.5% drop from the identical time in 2022.

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“2023 was a singular and troublesome 12 months and thru all of it we remained targeted on controlling what we may management, stayed on technique, and strengthened our basis for future progress,” UPS CEO Carol Tomé mentioned on the time.

UPS was down over 23% 12 months over 12 months as of Monday late afternoon.

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