FedEx and UPS shares drop on Amazon supply chain launch

Investing.com -- Shares of FedEx and United Parcel Service are trading sharply lower in premarket trading on Monday after Amazon announced the launch of Amazon Supply Chain Services, opening its logistics network to businesses beyond its own operations.

FedEx fell 5.7% while UPS dropped 4.1% in early trading.

Amazon announced Monday it is making its freight, distribution, fulfillment, and parcel shipping capabilities available to companies across industries including healthcare, automotive, manufacturing, and retail. The service extends Amazon's logistics infrastructure, which includes 80,000 trailers, 24,000 intermodal containers, and 100 aircraft.

Several major companies have already signed up. Procter & Gamble is using Amazon's freight services to transport raw materials and finished goods, while 3M is using the freight network to move products from manufacturing sites to distribution centers.

The offering includes freight services spanning ocean, air, ground, and rail transportation, distribution and fulfillment services for inventory management, and parcel shipping with two-to-five-day delivery speeds.

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