WASHINGTON, April 6 (Reuters) – Amazon.com on Monday announced it reached a new agreement with the U.S. Postal Service on package deliveries, and sources said the cash-strapped mail system would retain about 80% of its existing deliveries from its biggest customer.
That 20% cut is a dramatically better outcome for the postal agency than the two-thirds or larger reduction that Reuters reported last month Amazon had threatened.
USPS warned last month it could run out of cash as soon as October, and the risk that Amazon would replace the carrier by expanding its own delivery network or using rivals was an existential peril.
Amazon will continue its delivery expansion but short of growth that would rival USPS’s address-by-address reach, the sources said.
Reuters first reported the deal.
USPS has a roughly $80 billion budget, and Amazon represented $6 billion in annual revenue to the agency, according to two people familiar with the business arrangement.
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