- President Trump again accused Amazon of taking advantage of the US Postal Service, challenging the company to “build their own post office” during a press conference Friday.
- Trump has frequently complained that Amazon and other online retailers are taking advantage of USPS through below-market shipping rates.
- The president said he was considering using $10 billion in emergency coronavirus aid as leverage to exert more control over the cash-strapped USPS, suggesting it should quadruple its prices.
- Logistics experts have said Amazon benefits significantly from USPS, but raising rates could also make it more difficult for the Postal Service to compete with shipping companies, hurting its financial state in the long run.
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President Donald Trump on Friday revisited his claim that Amazon is responsible for the US Postal Service’s financial challenges during a press conference and suggested USPS should let the company handle its own shipping.
“If they raise the price of a package like they should — four or five times, that’s what it should be — or let Amazon build their own post office, which would be an impossible thing to do because the post office is massive and serves every little piece of the country … it would be a whole new ball game,” Trump said.
Trump has repeatedly accused Amazon, as well as other online retailers, of contributing to USPS’s financial woes by receiving below-market package-delivery rates — effectively arguing USPS is unfairly subsidizing transportation costs for the $1.2 trillion company.
As of 2018, USPS was approaching nearly $70 billion in cumulative losses, and last month, a group of Democratic lawmakers said the coronavirus outbreak could shutter USPS by June.
During Friday’s press conference, Trump confirmed a Thursday report from The Washington Post that his administration is considering using an emergency loan included in the $2 trillion coronavirus relief package as leverage to require the cash-strapped US Postal Service to make massive changes to its structure and management.
“If they don’t raise the price, I’m not signing anything,” Trump said, referring to the emergency loan, which must first be approved by the Treasury Department.
Trump’s criticism of Amazon’s relationship with USPS is hardly new, and he has been suggesting for years that USPS raise the rates it charges to deliver packages for the company to recoup its losses.
“Why is the United States Post Office, which is losing many billions of dollars a year, while charging Amazon and others so little to deliver their packages, making Amazon richer and the Post Office dumber and poorer?” Trump tweeted in December 2017.
Trump’s reasoning may have some merit: Logistics analysts have said that Amazon has been able to build a transportation network, in which the company can save money delivering its own packages, by relying significantly on USPS.
A December report from Morgan Stanley said Amazon’s in-house delivery network was “cherry-picking” the US’s densest ZIP codes. USPS is then charged with delivering Amazon packages in rural areas. Servicing rural areas, where homes are more spread out, is more expensive — and USPS isn’t able to recoup those losses by servicing urban areas on behalf of Amazon.
However, The Washington Post said raising package-delivery rates could also make it more difficult for USPS to compete with Amazon and other shipping companies like UPS and FedEx, hurting its financial state in the long run.
Rachel Premack and Grace Panetta contributed reporting to this story.