FedEx (NYSE: FDX) is taking a famous cue from The Shawshank Redemption: get busy living, or get busy dying. In an effort to combat the fallout of the company’s total split from Amazon (NASDAQ: AMZN), FedEx has officially launched Sunday ground delivery service. The company has long provided Sunday ground delivery service during the peak holiday season. However, this pivot to year-round Sunday ground delivery marks a turning point for the carrier as it adapts to the ever-changing landscape of eCommerce.
FedEx Pivots to Sunday Ground Delivery In Order to Combat the Recent Split from Amazon
One can only assume that offering Sunday ground delivery year-round is FedEx’s response to severing its business relationship with Amazon. Last year, FedEx announced it would no longer provide express shipping to Amazon’s customers. The announcement came at the beginning of June. Then, two months later in August, FedEx officially suspended all ground services to Amazon.
While the split from Amazon seemed like huge news at the time, it didn’t affect FedEx’s bottom line that much. The eCommerce giant only accounted for 1.3% of FedEx’s total revenue in 2018, after all. By providing Sunday ground delivery all year, FedEx will undoubtedly offset any losses incurred by ending that relationship.
Amazon Continues to Loom as a Potential Threat to All Major Shipping Carriers
Compared to last year, news from the Amazon shipping front has been fairly quiet in recent months. In this particular case, however, no news from Amazon is bad news for most shipping carriers. The eCommerce behemoth is busy quietly building out its own delivery network, and Bezos & co. are spending a ton of money doing it.
Amazon accounts for more than 50% of all eCommerce, and carriers like UPS and USPS simply can’t afford to cut ties like FedEx. However, Amazon is moving ever closer to keeping all of its shipping in-house. When that reality finally comes, the end of Amazon’s relationship with all other carriers will be inevitable.