Amazon to Invest $4 Billion to Speed Delivery in Rural Areas

Amazon said Wednesday (April 30) that it will invest over $4 billion to expand its rural delivery network and provide faster delivery to millions of customers in less densely populated areas.

The investment will expand Amazon’s rural delivery network to over 200 delivery stations, create over 100,000 new jobs and enable the retailer’s network to deliver over a billion packages each year to customers in more than 13,000 ZIP codes, Udit Madan, senior vice president, Amazon Worldwide Operations, said in a Wednesday blog post.

“At a time when many logistics providers are backing away from serving rural customers because of cost to serve, we are stepping up our investment to make their lives easier and better,” Madan said in the post.

Amazon opened its first rural delivery station in 2020, began scaling its small-town delivery network in 2023 and has accelerated its average delivery speeds by 50%, according to the post.

“By the end of 2026, we’ll have tripled the size of our rural delivery network, to provide Prime members from Milton, Florida, to North Pole, Alaska, (and thousands of small towns and rural communities in between) the ability to shop from over 300 million items from the convenience of their homes and receive their packages even faster — cutting average delivery times in half,” Madan said in the post.

It was reported that Amazon was ramping up its logistics expansion efforts by acquiring industrial property and restructuring its distribution network to speed delivery and reduce costs.

At the time, the company had leased, bought or announced plans for over 16 million square feet of new warehouse space in the U.S. in the first five months of 2024, adding to its existing footprint of about 413 million square feet of industrial real estate across the country.

UPS said Tuesday (April 29) that it was accelerating its planned volume reduction from Amazon, long a major customer, and now expects to slash Amazon package volume in its network by more than 50% by June 2026.

UPS executives said the decision reflects UPS’ pivot away from low-margin, high-volume accounts and toward more profitable business.