DHL eCommerce signed a $10B exclusive multi-year contract with the U.S. Postal Service to handle its last-mile parcel delivery in the U.S., marking the first time that the two organizations have entered into a multi-year agreement in their 25-year history of working together.
Through the arrangement, DHL eCommerce will handle nationwide pickup and sortation across its 19 automated hubs, transport packages between facilities on its air and ground network, and then hand off to USPS for final-mile delivery to more than 41,550 ZIP Codes and 170 million delivery points six days a week.
Scott Ashbaugh, CEO of DHL eCommerce Americas, said the deal creates a “dependable, long-term platform” for customers and supports the company's emissions reduction goals by minimizing additional vehicles on the road. Postmaster General David Steiner said the extended agreement aligns DHL eCommerce more closely with USPS's transformed network to create a “stronger, more efficient last-mile solution.”
Last year, USPS developed a new auction system to determine market rate for its services and make Amazon and other business customers compete for postal capacity. Does this mean that DHL placed a $10B bid and won the auction?
Not exactly. Steiner says that DHL did not directly place a bid, but that the auction process helped inform how the arrangement was structured. He told FreightWaves:
“Through the Last Mile solicitation process, we gained significant insight into market demand and customer needs. That initiative helped validate the value of our network and highlighted opportunities to create more flexible pricing and operational models tied to our evolving last-mile infrastructure. The DHL agreement reflects many of those learnings.”
It's been highly reported that USPS posted a $9B annual loss in 2025 and is facing a serious cash crunch by 2027, which is part of the reason the agency renegotiated its deal with Amazon earlier this year. While this new $10B deal spread over an undisclosed multi-year term won't close the $9B annual gap on its own, it will provide USPS with dependable, recurring revenue to steady the ship while it lobbies Congress to lift its borrowing cap.
