Shifting Ground Beneath FedEx & UPS

The Shifting Ground Beneath FedEx and UPS: How Private Networks Are Redefining the U.S. Parcel Market

ShipMatrix has released its first U.S. Domestic Parcel Market Report for 2024, and the findings underscore a transformative shift in the shipping landscape. While total parcel volume continues to grow, legacy carriers like FedEx and UPS are facing a shrinking addressable market—largely due to explosive growth from private delivery networks and alternative carriers.

📦 U.S. Parcel Volume Hits Record High

• In 2024, total U.S. parcel volume reached 23.8 billion—a 4% increase over 2023 and 1.5x more than the 16.1 billion parcels delivered in 2019.
• That equates to 779 parcels every second or 67 million daily.
• On average, each person received 70 parcels in 2024—about 3.5 parcels per week per household, strengthening last-mile delivery density for B2C shipments.

📉 The Changing Addressable Market

While volume is growing, traditional players aren’t benefiting equally. The most significant trend? Major retailers—once among the largest customers of FedEx, UPS, and USPS—are now delivering billions of parcels themselves, reducing dependency on national carriers.

• Amazon Logistics delivered 6.1 billion packages in 2024 (up from 1.7B in 2019).
• Walmart and others handled 2.3 billion parcels in 2024 (up from 0.6B in 2019).
• Alternative carriers such as OnTrac, Veho, Better Trucks, and Jitsu have grown volume by 4x since 2019.

🏁 Market Share by Average Daily Volume (ADV)

Despite USPS leading in total ADV at 20.4 million, half of that includes last-mile deliveries on behalf of other carriers. Excluding those hand-offs, the true daily leaders are:

• Amazon Logistics: 17.1 million
• UPS: 13.7 million
• FedEx: 9.7 million
• USPS (net): 10.1 million

💰 Parcel Market Revenue Trends

• The U.S. parcel market grew 4.1% in 2024, reaching $188 billion.
• Average revenue per parcel was $8.

Top revenue generators:

• UPS: $59.8 billion
• FedEx: $48.2 billion
• Amazon Logistics: $34.7 billion
• USPS: $32.5 billion
• Other carriers: $13 billion (up 48% YoY)

📈 Looking Ahead: Growth Without Legacy Carriers?

ShipMatrix projects that the U.S. parcel market will grow at a CAGR of 4% over the next three years—reaching 26.8 billion parcels by 2027. However, most of this growth is expected to be captured by private delivery networks like Amazon, Walmart, Target, and emerging regional carriers. This leaves FedEx, UPS, and USPS facing flat or even negative growth.

📝 Final Thought

The very companies that helped fuel the growth of FedEx, UPS, and USPS are now building their own delivery ecosystems. As private networks continue to expand and gain efficiency, national carriers must evolve rapidly to stay competitive in a parcel market that’s growing—but becoming increasingly out of their reach.

Sources: ShipMatrix, company financials, and SEC filings

Source: ShipMatrix

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