Postal Updates

UPS to replace FedEx as primary air cargo provider for USPS

Apr 12, 2024, 9 AM

By Allen Abel, Washington Correspondent

The United Parcel Service, generally referred to as UPS, will replace FedEx as the carrier of the majority of airborne Priority Mail Express and Priority Mail beginning in late September, the United States Postal Service announced April 1.

The designation of UPS as the primary air cargo provider for the Postal Service came two days after negotiations between the USPS and FedEx broke off with no agreement on a new contract. FedEx had been the principal air carrier for domestic first-class and parcel mail for more than 20 years.

The switch of air partners comes at a time when the USPS already has begun to divert the majority of package and first-class mail delivery to trucks rather than planes.

“More than 95% of First-Class Mail and more than 95% of First-Class packages are moved through our ground transportation system,” Postmaster General Louis DeJoy told the USPS board of governors in August 2023, according to an Aug. 8, 2023, press release from the USPS. “This is a reduction by over 90% from just two years ago and puts us on course to reduce approximately 1 billion dollars from our annual air transportation cost.”

Postal Service mail accounts for only 4 percent of FedEx’s annual revenue, according to the Reuters news agency. However, the loss of the postal contract could leave the carrier with 200 to 300 surplus pilots, according to analysts at the FreightWaves website.

According to FreightWaves, which was citing what it called “an unauthorized recording,” Pat DiMento, FedEx’s vice president of flight operations and training, recently told a group of the company’s senior pilots, “If I were to bet, I think we lose 50% of our daytime flying.”

After the deal between UPS and the USPS was made public, a spokesperson for the Air Line Pilots Association, International, the union representing FedEx pilots, said, “With each new announcement, FedEx management continues to threaten every FedEx employee’s job security and quality of life.”

In an April 1 report on the UPS website, Carol Tome, CEO of UPS, described the agreement as “an innovative solution that is mutually beneficial and complements our unique, reliable and efficient integrated network.”

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