Online retail giant Amazon.com is reportedly experimenting with a new delivery service.

Bloomberg reported, citing two people familiar with the matter, that Amazon’s new service would be aimed at making more items available for free two-day shipping. It would also relieve overcrowding in the company’s warehouses.

The news sent shares of FedEx and UPS lower, with the stocks dropping 2.4 percent and 2.9 percent, respectively.

Amazon has been testing the new service in India for two years, Bloomberg said, adding it was deployed in West Coast states on a trial basis earlier this year. The report also said Amazon is calling the project “Seller Flex” and that it plans a broader rollout in 2018.

With this project, Amazon would directly take over functions typically handled by UPS and FedEx, Bloomberg said.

Shares of Amazon rose slightly in the premarket.

Amazon, FedEx and UPS did not immediately respond to CNBC’s requests for comment.

Click here to read Bloomberg’s full report.

Source: Tech CNBC
Amazon is reportedly testing its own delivery service