Can Amazon turn its logistics network into a full-service supply chain business?

Is Amazon moving to take over the logistics stack? Amazon is opening its logistics network to external businesses — effectively building an end-to-end logistics machine, under the brand Amazon Supply Chain Services, that could compete with UPS and FedEx.

What Amazon is actually selling: Amazon is pitching freight transport, bulk storage, inventory positioning, fulfillment across non-Amazon sales channels, and parcel shipping with two-to-five-day delivery. The company says the network includes more than 80k trailers, over 24k intermodal containers, and more than 100 aircraft — but still behind FedEx and UPS.

Market reax: UPS and FedEx shares fell more than 9% after the launch — while the sell-off spread into other logistics names — with DHL down 7.3% and GXO down nearly 13%.

Big names are already in play. Procter & Gamble is using the network to move raw materials and finished goods; 3M is using it between manufacturing sites and distribution centers; Lands’ End is using a unified inventory pool across sales channels; and American Eagle Outfitters is using Amazon’s parcel network for direct-to-customer deliveries.

Why it matters

UPS had already decided to shrink its Amazon exposure, with previous plans to cut Amazon volumes by more than 50% by 2H 2026 and focus on fewer and more lucrative deliveries.

Amazon makes it more complicated: Established carriers have spent years pulling back from weaker e-commerce exposure and deeper into denser markets. Amazon is now chasing them into higher-value work, including healthcare, where both companies have been trying to build deeper margin protection.

Amazon has already grown too large to be treated as just another e-commerce shipper. The logistics giant delivered last year more than a quarter of the 23.9 bn parcels shipped in the US, while FedEx and UPS combined moved around a third.