FedEx and UPS Shares Tumble as Amazon Takes Aim at the Freight Industry

TLDR

• Amazon launched Amazon Supply Chain Services, opening its freight and delivery network to outside businesses
• FedEx fell around 5–6% and UPS dropped over 4% in early Monday trading
• Early customers include Procter & Gamble, 3M, Lands’ End, and American Eagle Outfitters
• The service covers freight, fulfillment, parcel shipping, and AI-powered demand forecasting
• Other logistics stocks also fell, including GXO Logistics, XPO, and Hub Group

Amazon announced Monday it is opening its logistics network to businesses outside its own platform. The new service, called Amazon Supply Chain Services, lets companies across multiple industries use Amazon’s freight, fulfillment, and shipping infrastructure.

The announcement immediately hit shares of rival logistics companies. FedEx fell between 4.4% and 5.7%, while United Parcel Service dropped around 4.1% to 4.2% in premarket and early trading. Amazon shares rose about 1.2% to 1.75% on the news.

United Parcel Service, Inc., UPS

Other logistics companies also saw their shares fall. GXO Logistics dropped 5.2%, XPO fell 2.5%, Hub Group declined 1.7%, and RXO was down 1.7%.

Amazon’s logistics network is large. It includes 80,000 trailers, 24,000 intermodal containers, and 100 aircraft. That infrastructure was previously used mainly to support Amazon’s own retail and marketplace operations.

The new service bundles several offerings together. Businesses can access ocean, air, ground, and rail freight. They can also use Amazon’s distribution and fulfillment centers for inventory management, along with parcel shipping with two-to-five-day delivery speeds.

The service also includes AI-powered tools. These tools handle demand forecasting and inventory placement to help companies improve delivery speed and reliability.

Businesses access everything through a single online console. From there, they can pick and configure the services they need.

Several well-known companies are already using the service. Procter & Gamble is using Amazon’s freight network to move raw materials and finished goods. 3M is using it to shift products from manufacturing sites to distribution centers.

Early Customers Span Multiple Industries

Lands’ End and American Eagle Outfitters are also among the early customers. Amazon said the service is available to businesses of all sizes across healthcare, automotive, manufacturing, and retail.

The move puts Amazon in more direct competition with established logistics providers. FedEx and UPS have long dominated the parcel and freight delivery market in the United States.

Amazon has been building its own delivery network for years. That network has grown large enough that the company now handles a large share of its own deliveries rather than relying on outside carriers.

Impact on Freight Stocks

The stock moves on Monday reflect how seriously investors are taking the announcement. Multiple logistics names saw meaningful declines within hours of the news breaking.

Amazon confirmed the service is live and already being used by named enterprise customers. The company did not disclose pricing details in its public announcement.

GXO Logistics saw the steepest drop among the wider group of affected stocks, falling 5.2% on the day.

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