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It is the start of a brand new partnership between the U.S. Postal Service and UPS — but it surely ends a long-term relationship with rival service FedEx.
The USPS stated on Monday that UPS would now be its main air cargo supplier after FedEx had stood within the place for over twenty years.
“This award is efficient instantly and significantly expands the prevailing relationship between the 2 organizations,” UPS stated in a company release. “Following a transition interval, UPS will develop into the USPS’s main air cargo supplier and transfer nearly all of USPS air cargo within the US.”
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UPS known as the partnership with the USPS “mutually helpful” because it goals to clean out each group’s already “built-in community.”
The precise monetary phrases of the brand new partnership haven’t been publicly disclosed, however Reuters reported that UPS famous the worth was “important.”
The outlet additionally famous that FedEx had made an estimated $2 billion yearly from its contract with the USPS.
FedEx, in the meantime, said on Monday in a securities submitting that they have been “unable to achieve settlement on mutually helpful phrases to increase the contract” and that it could make changes to make up for the loss.
In Q4 2023 earnings, UPS reported consolidated revenues of $24.9 billion, down considerably (7.8% roughly) from the $27 billion it introduced in on the identical time final yr.
Quarterly consolidated working revenue got here in at $2.5 billion in This fall, a 22.5% drop from the identical time in 2022.
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“2023 was a singular and troublesome yr and thru all of it we remained centered on controlling what we might management, stayed on technique, and strengthened our basis for future development,” UPS CEO Carol Tomé stated on the time.
UPS was down over 23% yr over yr as of Monday late afternoon.
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