Credit Suisse flips around yesterday's story about issues at FedEx (NYSE:FDX) that led to Amazon (NASDAQ:AMZN) blocking certain third-party sellers from using the ground and home delivery service for Prime shipments.
"We cannot help but wonder whether the news is symptomatic of broader delivery issues that AMZN’s own network might be facing as we approach the final days of what is an already compressed peak season – particularly given the added constraints of one-day shipping and fewer external carrier options (non-renewal of FDX Express/Ground contracts)," notes the firm.
"While weather was partly responsible for delays during Cyber week for most carriers, AMZN also cited high demand/record orders as resulting in longer than normal delivery times based on constrained fulfillment and delivery capacity in certain areas. In our view, this underscores the idiosyncratic challenges that AMZN’s less mature in-house delivery capabilities face relative to the well-established, end-to-end hub networks at both FDX and UPS."
The conclusion is that there is the possibility that a classic diversion tactic was in play with the partial ban by Amazon on FedEx yesterday.
Shares of FDX are down 1.16% premarket to $162.20. AMZN is up 0.38%.
Previously: FedEx lower after Amazon bans certain deliveries (Dec. 16)
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