This article is more than 2 years old

This article is more than 2 years old

Donald Trump again attacked Amazon on Saturday, calling the online retailer’s business deal with the US Postal Service a money-losing agreement.

Trump lashes out at Amazon and sends stocks tumbling Read more

Federal regulators, however, have found the contract with Amazon to be profitable.

In tweets on Saturday morning, Trump said: “The US Post Office will lose $1.50 on average for each package it delivers for Amazon. That amounts to Billions of Dollars.”

He added: “If the P.O. ‘increased its parcel rates, Amazon’s shipping costs would rise by $2.6 Billion.’ This Post Office scam must stop. Amazon must pay real costs (and taxes) now!”

Amazon has been a consistent target, suffering falls in its stock price after presidential attacks. Its founder, Jeff Bezos, owns the Washington Post, which Trump has called “fake news” over its reporting of his campaign and presidency, not least the continuing investigation by special counsel Robert Mueller of Russian election interference and alleged collusion by figures linked to Trump.

The president returned to the offensive this week after the website Axios reported that he was “obsessed” with the company. He suggested the postal service deal with Amazon hurt taxpayers. But as an independent agency, the USPS does not use taxpayer money.

A spokesman for the US Postal Service declined to comment.

Amazon lives and dies by shipping and an increase in the rates it pays could certainly do some damage. Amazon sends packages via the post office, FedEx, UPS and other services.

But while the post office has lost money for 11 years, package delivery – which has been a bright spot – is not the reason.

Boosted by e-commerce, the USPS has enjoyed double-digit increases in revenue from delivering packages. But that hasn’t been enough to offset pension and health care costs as well as declines in first-class letters and marketing mail. Together, letters and marketing mail make up more than two-thirds of postal revenue.

In arguing that the USPS is losing money on delivering packages for Amazon, Trump appears to be citing some Wall Street analyses that argue the USPS formula for calculating its costs is outdated.

A 2017 analysis by Citigroup did conclude that the USPS was charging below market rates as a whole on parcels. Still, federal regulators have reviewed the Amazon contract each year and determined it to be profitable.

The post office does not break down what is driving its growth, but online ordering from retailers, particularly Amazon, has revolutionized the way goods are bought and delivered.

The USPS reached new highs this year in holiday package delivery, with more than 850m US parcels delivered from Thanksgiving to New Year’s Eve, according to figures compiled by the industry tracker ShipMatrix.



Amazon has taken some steps toward becoming more self-reliant in shipping. Last year, it announced it would build a worldwide air cargo hub in Kentucky, about 13 miles south-west of Cincinnati.