Originally Posted by
Santa
Who is Amazon going to use for the Postal Contracts? ATSG/ATLAS/KALITTA? They will need to have aircraft and personnel to do this.. sure would be a stretch for any of them to get more aircraft (and crews) to fly them. I'll bet money that FedEx will get the contract again. Just my two cents...
Have you been paying attention? Amazon Air already has 33 767Fs. Boeing is accelerating the 767 production line.
Amazon is building a 900+ acre hub next to the existing DHL hub in KCVG. Amazon is partnering with DHL and DHL just announced they're back in the American shipping market which UPS and FedEx ran them out of years ago.
Amazon expects their new 100-plane hub will be operational by 2020.
Yes, I agree, most likely Amazon Air won't be prime time ready when the next round of contracts are available, but they can bid on part of the contract. FedEx doesn't have it all. UPS and other airlines have parts of the postal contract. Any loss for FedEx wouldn't be good for us obviously.
Amazon will continue to look for ways to help offset their costs for shipping. And if they can use the government to subsidize their Amazon Air network, just like they already use the USPS to subsidize their "last mile of shipping", they're going to do it. Amazon isn't stupid and they're flush with cash. So much cash, in just one day Amazon made more money than what FedEx's total market capitalization equals. FedEx is a bump in the road for Amazon and everyone saying that there's no way Amazon can ship all of their own stuff, they're proving those people more wrong every single day.
Originally Posted by
LunkerHunter
Are the postal contract terms on the FDX Quicktake page accurate- 10.5 billion, 7 years ... 1.5 billion per year? That’s about 2.5% of yearly revenue. 40% of daily flying though sounds a lot worse.
FedEx is a corporation of several companies. FedEx Express won the contract and as of May 2017 (end of FedEx's fiscal year) the unit revenue for FedEx Express was $26.4 billion. So yes the postal contract only represents 5-6% of the total revenue of FedEx Express. However FedEx uses the postal contract to make its shipping form more lucrative. I don't know what percentage of FedEx Express products move during the day sorts but I would imagine it is extremely small. I've never shipped or received a FedEx Express package that went through the say sort. And during my time on the 757, it seems most of that freight was USPS.
All I know is that losing the postal contract in its current form would be bad news for new hires at the bottom of the list. I don't see 4.A.2.B. being enough to keep us out of a furlough situation.
What do others think?