Amazon.com (AMZN) is barring its third-party sellers from using FedEx’s (FDX) ground delivery for Prime shipments, as the shipping giant makes a final holiday shopping push. Amazon stock rose and FedEx stock fell.
The block on FedEx Ground and Home services starts this week and will last “until the delivery performance of these ship methods improves,” according to an Amazon email seen by The Wall Street Journal.
Amazon is allowing sellers to use the more costly FedEx Express for Prime orders or FedEx Ground for non-Prime shipments. Amazon itself has stopped using FedEx for its own U.S. deliveries.
The decision affects a small number of businesses, limiting their options during peak shipping season, FedEx told the Journal.
“The overall impact to our business is minuscule,” a FedEx spokeswoman said, citing expectations for record holiday volumes.
Amazon declined to comment.
Shares of FedEx fell nearly 1% to 164.10 on the stock market today, falling back below the 200-day line. FedEx stock opened higher Monday morning amid the preliminary U.S.-China trade deal, falling intraday to 161.50. Amazon stock added 0.5% to reclaim its 50-day line. FedEx rival UPS (UPS) rose 0.4%.
Amazon’s move is the latest escalation in the increasingly tense relationship between shipping giant FedEx and Amazon.
Earlier, FedEx ended some Amazon contracts this year. Meanwhile, Amazon is building out its own shipping network. Still, FedEx stock hasn’t been affected much by its Amazon feud as only a narrow share of its shipments originate with Amazon. UPS, however, is more exposed.
FedEx earnings also are due late Tuesday. Analysts foresee FedEx earnings sliding 30% to $2.84 and sales dropping 1% to $17.57 billion, amid trade and Amazon headwinds. Investors will want to learn more about the FedEx-Amazon saga and how overall holiday e-commerce shipments are going.
Author: Aparna Narayanan
Source: Investors: Spiraling Amazon-FedEx Feud Escalates With This Latest Move