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Internet Amazon's new delivery program shouldn't hurt FedEx, UPS A new project called "Shipping with Amazon" is reportedly coming soon, but some analysts don't see it as a big threat to shippers.
AP Images for Amazon Amazon looks to be moving deeper into the shipping world. The online retailer plans to launch a program called "Shipping with Amazon" in Los Angeles in a few weeks, in which the company will pick up and ship packages to customers, according to a report from The Wall Street Journal.
The service, which will expand to more cities as soon as this year, would start with third-party sellers on Amazon but could eventually open to other businesses, the report said.
The program seems to mesh with Amazon's efforts to build up its own shipping infrastructure so it can handle the growing mountains of packages it needs to deliver. Last year, more than 5 billion items shipped with its Prime program worldwide, the company has said. Amazon has invested in a new air cargo hub in Kentucky, 40 Prime Air cargo planes and 4, truck trailers.
It also runs its own on-demand local delivery service called Amazon Flex. Amazon started investing in these resources after the holiday season, when some of its packages were delivered late by its shipping partners.
That work should help ensure customers packages will arrive on time more often. Amazon would need to significantly amp up its investment in shipping to match those other organizations, several analysts said.
Cowen analyst Helane Becker wrote in an investor note Friday that worries about Amazon's push into the shipping world were "somewhat overblown," saying the complex delivery networks of FedEx and UPS were "highly difficult to replicate.
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