Prime is thinking about returning one of its oldest relationships to sender. Its operator, Amazon, is quietly modeling a future without the Postal Service.
According to the Washington Post, Amazon has sketched out plans to pull the billions of packages it routes through the U.S. Postal Service by the end of 2026, when its current deal expires. i For the USPS, an institution that lost $9.5 billion last year on about $80.5 billion in revenue, this separation could be less of a trim and more of a buzz cut.
Amazon’s ability to entertain this move isn’t coming out of nowhere. The company has quietly built a shadow postal service that, in 2024, delivered 6.3 billion parcels a year in the U.S., just behind the USPS’ 6.9 billion, according to Pitney Bowes’ Parcel Shipping Index. That puts Amazon at about 28% of U.S. parcel volume versus USPS at 31% — and keeps Amazon on track to overtake the government carrier by 2028 if growth holds.
And growth seems to be set to hold: The company has been spending billions to triple its same- and next-day network by 2026 — adding over 200 delivery stations and boosting rural capacity enough to cover 13,000 ZIP codes and more than a billion additional packages a year — striking a fresh delivery deal with FedEx just months after UPS said it would shrink its Amazon exposure. The only thing left for Amazon to chase is the government carrier that helped train shoppers to think of two-day shipping as a basic right.
So what exactly is USPS doing for a company that already owns planes, sort centers, and blue vans with smiles on them? The Postal Service handles the awkward stuff. Through Parcel Select, high-volume shippers such as Amazon inject presorted packages deeper into the network and let local carriers handle the sweaty door-to-door work. USPS describes the product as a discounted work-share option for big mailers; internal bulletins frame it as the way other carriers tap USPS for the “last mile,” especially in non-metropolitan and rural areas where it’s the only carrier that goes everywhere — six days a week
Now, USPS wants to stop acting like Amazon’s bespoke discount sidekick. Under its new “democratized” playbook, which the Washington Post reported on, the Postal Service is phasing out this sweetheart treatment and moving big customers into more open, auction-style contracts for products such as Parcel Select.
The government carrier has been busy trying to drag itself into the black by leaning harder on parcels, while mail volumes keep falling. Packages are where there’s still margin. Letters are a legal obligation with a stamp on top. In its latest fiscal report, the Postal Service flagged softer-than-expected package revenue even after new products such as Ground Advantage and a round of price hikes pulled in more money — and USPS is still bleeding cash. Annual net losses still hover around $9–9.5 billion, and cumulative losses since 2007 sit north of $100 billion.
The Washington Post reports that industry groups and lawmakers are already sketching out what a second USPS rescue would look like, only a few years after Congress approved more than $100 billion in relief to stabilize the agency.
If Amazon actually walks in 2026, the plumbing changes fastest in the background. If Amazon stops renting USPS’ universal reach, the company could have to choose among spending more to run its own sparse routes, paying higher rates to UPS and FedEx, or quietly dialing back how generous “Arriving tomorrow” really is in certain ZIP codes.
