FedEx cuts ties with Amazon in sign of new rivalry

[WASHINGTON] FedEx said Wednesday it would stop ground deliveries for Amazon in the latest sign of competition between the two firms.

The move comes two months after the package delivery giant announced it was ending express service with Amazon as it moves to work with others in the online retail sector.

"This change is consistent with our strategy to focus on the broader e-commerce market, which the recent announcements related to our FedEx ground network have us positioned extraordinarily well to do," a FedEx statement said.

Amazon has also been bolstering its own logistics network and earlier this year offered employees US$10,000 to quit their jobs to create their own delivery enterprise.

In June, FedEx said Amazon accounted for less than 1.3 per cent of its total revenue for 2018 and announced it was building out a network "to serve thousands of retailers in the e-commerce space."

Amazon, which also has its own aircraft and vehicle fleet for its logistics and is experimenting with drone and robot deliveries, has faced criticism from President Donald Trump who claimed its deal with the US Postal Service gave the company overly favourable rates.

AFP