UPS Reaches Deal to Carry U.S. Mail Via Its Air Fleet
PS Inc. and the U.S. Postal Service have agreed to a deal under which UPS will carry some U.S. mail on its airplanes, the company said Wednesday.
The agreement between the sometime-rivals in package delivery calls for UPS to begin flying mail as soon as Saturday. UPS said it will fly mail each week to and from 98 U.S. cities.
The deal is expected to generate revenue of more than $100 million a year for UPS — a fraction of its annual revenue but an expansion of its business relationship with the post office, the Wall Street Journal reported Wednesday.
If UPS is successful, it could be in position to compete for postal business now handled by FedEx Corp. when that company’s $1.3 billion annual contract that was first signed in 2001 comes up for renewal next year, the Journal reported.The deal calls for UPS to carry primarily priority and first-class mail, with the possibility to move one- or two-day Express Mail pieces.
UPS — ranked No. 1 in the Transport Topics 100 listing of for-hire North American carriers — is the second-largest U.S. air cargo carrier behind FedEx, ranked No. 2 on the TT 100.
