Amazon to spend $4 billion on small town delivery expansion

Amazon said Wednesday it plans to spend roughly $4 billion by the end of 2026 on expanding deliveries in rural towns as part of a push to bring faster shipping times to more parts of the U.S.

Once the expansion is complete, more than 200 delivery stations will be added, tripling the size of Amazon's rural delivery network, the company said. The move will bring products closer to customers, and cut average delivery times "in half," Amazon added.

"At a time where 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," Udit Madan, Amazon's senior vice president of worldwide operations, said in a statement.

When the new facilities are open, Amazon said it aims to create about 170 jobs at each site.

The announcement comes as Amazon is set to report first-quarter earnings after the bell on Thursday. It's also landing one day after Amazon drew the ire of the White House for reportedly planning to display how much of an item's cost is due to tariffs. Amazon said the plan was "not going to happen" and it had only considered such a move for products on its discount storefront, called Haul.

Several tech companies including Apple, IBM and Nvidia have pledged to boost spending in the U.S. since Trump took office in January and laid out plans to boost manufacturing and create more jobs in America.

Amazon has been working to speed up deliveries for the past several years. After making two-day delivery the standard, the company has invested in shuttling packages to shoppers' doors in one day, or in some cases, within a few hours.

It's been able to do this by building up a massive network of warehouses across the country, as well as by bringing more of its logistics operations in house. In 2022, Amazon said it was poised to pass UPS and FedEx to become the largest U.S. package delivery service.

The company still relies on carriers for a portion of its deliveries, including the U.S. Postal Service, which is traditionally relied on for shipments to costlier and less dense rural areas. UPS said this week it would cut about 20,000 jobs, partly as a result of its push to slash Amazon deliveries by more than half.

A growing share of Amazon deliveries are being made by its delivery service partner program, which is made up of thousands of contracted third-party companies, as well as legions of Flex gig workers. Amazon has also recently expanded another program, launched in 2023, that enlists mom-and-pop shops in rural towns to make deliveries on the company's behalf.

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