U.S. President Donald Trump departs for holiday travel to his Mar-a-Lago estate in Florida, from the White House in Washington, U.S. December 22, 2017. REUTERS/Jonathan Ernst
December 29, 2017
By Makini Brice
WASHINGTON (Reuters) – U.S. President Donald Trump targeted Amazon<AMZN.O> on Friday in a call for the country’s postal service to raise prices of shipments in order to recoup costs, picking another fight with the online retail giant he has criticized in the past.
“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? Should be charging MUCH MORE!” Trump wrote on Twitter.
The U.S. Postal Service, which runs at a big loss, is an independent agency within the federal government and does not receive tax dollars for operating expenses, according to its website. The organization makes up a significant portion of the $1.4 trillion U.S. delivery industry. Other players include United Parcel Service Inc <UPS.N> and Fedex Corp<FDX.N>.
Amazon was founded by Jeff Bezos, who remains the chief executive officer of the retail company. Bezos also owns the Washington Post, a newspaper that Trump has repeatedly railed against in his criticisms of the news media.
In tweets over the past year, Trump has said the “Amazon Washington Post” fabricated stories. He has said Amazon does not pay fair taxes and so hurts other retailers, part of a pattern by the former businessman of periodically turning his ire on big American companies since taking office in January.
Representatives for the White House, the U.S. Postal Service and Amazon were not immediately available for comment.
According to the U.S. Postal Service’s annual report, the agency lost $2.74 billion this year, and its deficit, from when it was spun off into an independent agency in 1971, has ballooned to $61.86 billion. In 2016, the USPS lost $5.59 billion and had a total deficit of $55.98 billion.
The organization had projected to lose $4.2 billion and said in its annual report that the loss this year was lower than expected primarily because of a “$2.2 billion reduction in workers’ compensation liability.”
While the postal service’s revenue for first class mail, marketing mail and periodicals is flat or declining, the revenue from package delivery is up 44 percent since 2014 to $19.5 billion in the 2017 fiscal year that ended on Sept. 30, the postal service said.
Amazon has shown interest in the past in shifting into its own delivery service. In 2015, the company spent $11.5 billion on shipping, 46 percent of its total operating expenses that year.
In October, Bloomberg reported that Amazon was testing its own delivery service to move products more quickly out of its overcrowded warehouses and make more of them available for free two-day delivery.
However, Amazon said at the time that it was using the same carrier partners to offer the program as it has used for years, including the U.S. Postal Service, UPS and FedEx.
Shares of Amazon were last down 0.62 percent to $1,178.66.
(Reporting by Makini Brice; Editing by Damon Darlin and Frances Kerry)
