atpcliff

They bought Comair's HQ. Did they also buy that certificate???

135tankerdriver

interesting article… sounds like the only thing holding Amazon back from expanding their ops into China is fleet type. As just a casual observer although Amazon Air is growing quickly it seems like Amazon is slow rolling this leasing/buying used planes, etc vs buying 777s now. Is it because they aren’t in a rush and just want to have a freight presence?

Some interesting times. Love to see how the plays out. I’m definitely rooting for FedEx and UPS.

FlyAstarJets

The Comair building is owned by the Kenton County Airport Board since 2011 (purchased from DAL). AMZ leased space from KCAB in 2019 while the AMZ Hub build out is on going.

As for the Comair AOC? Wasn’t that surrendered by DAL to the FAA years ago?

Reese

https://www.foxbusiness.com/retail/a...-4-star-stores

Another failed venture by Amazon. Adds to the dozens+ of others, further proof they don’t always succeed, in fact, fail quite a bit.

some stats over the last year…

Amazon
Year over year growth/decline

*Product Sales: +12%
Service(AWS) Sales: +34%
Total Sales: +22%

Operating Expenses
Cost of sales: +17%
*Fulfillment(shipping): +29%
Technology & Content: +30%
Marketing: +48%
General & Administrative: +31%
Total Operating Expenses: +23%

Consolidated Sales: +22%
Consolidated Expenses: +23%
Operating Income: +9%
Net Income(minus Rivian): +5%

Amazon.com(not AWS)
NORTH AMERICA
Net Sales: +19%
Operating Expenses: +20%
Operating Income: -16%

Amazon.com INTERNATIONAL
Net Sales: +22%
Operating Expenses: +24%
Operating Income: -220%

Amazon.com Operating Margin: +2.6%
Amazon.com Intl Operating Margin: -.7%
AWS Operating Margin: +30%

Overall:
AWS made up only 13% of sales, but comprised 75% of all operating income


Amazon was part of the IPO for Rivian cars and included an $11.2B stock gain as part of their net income even though they didn’t sell it.

That’s where you’re seeing the news of Amazon net income so high. Without rivian, it would have only been a 5% growth YoY

tnkrdrvr

The challenge for Amazon getting into air freight and last mile delivery has always been the tremendous upfront costs to build out their network and the high ongoing cost of labor. It’s always been low margin relative to the software business. UPS has led the sector with a little over 10% profit margins historically. That doesn’t leave much room to build a profitable business and the savings of bringing their shipping in house will take many years to pay off the steep upfront costs. I don’t think Amazon will pull out of the business, but I think their appetite for further capital investment in it may shrink.

Pyper

Funny you say that. I recently spoke to a friend of mine at Amazon corporate he indeed says their appetite has shrunk and shifting their business model. Didn't get into it as to which and why just basically what you said...

wjcandee

When the alternative is paying UPS and FedEx, with their 10+% markups and insufficient commitment to customer delight, running their own show has turned out to be a cost-saver and a winner as far as delivery reliability is concerned, as proven by what happened during COVID. I don't know where your friends are getting their information.

As to capital expense, has anybody noticed that the capital expenditures, for the most part, have already been made? That sort in CVG is not something they're thinking of doing, it's something they have DONE, and now just need to ramp up. Nobody with a brain ever believed that Amazon was planning to serve the general public as an overnight delivery service, although the media kept saying that. Maybe some b-to-b as an accessory service to make selling on Amazon desireable, but nothing to the general public. Never made any sense and isn't going to happen. If that's the "shift", then, yeah, some people came to their senses.

wjcandee

The very-best companies are never afraid to try something, they're not afraid to fail. The only way you hit a home run is to step up to the plate. Risk-aversion killed Xerox and Kodak. Think about it: Xerox invented WYSIWYG, the mouse, and point-and-click. And they capitalized on none of it, because the copierheads at the Home Office weren't willing to take risk. Steve Jobs appropriated those ideas, developed them, and the rest is history.

Domino's approach: https://www.youtube.com/watch?v=wRaM3x78FEw

https://businessleadersformichigan.c...tion-FINAL.pdf

jpncrjdriver

Yes the Comair AOC was surrendered after the shutdown...

Kampai, Jpncrjdriver

DirtyPurple

https://www.freightwaves.com/news/am...uses-this-year

From article:

“We currently have some excess capacity in the network that we need to grow into,” Olsavsky told investors on Amazon’s Q1 2022 earnings call. “So, we’ve brought down our build expectations. Note again that many of the build decisions were made 18 to 24 months ago, so there are limitations on what we can adjust midyear.”

The slowdown can be attributed to a few different factors. Many point to inflation as the main culprit — with less disposable income, shoppers are trying to save by spending less online, putting their money into things like travel and fuel. Subsiding pandemic fears are also driving a departure from e-commerce and a return to in-person shopping.

Even with the pullback on new warehouse plans, Amazon boasts a fulfillment footprint no other company can rival. According to data from supply chain consulting firm MWPVL International, it boasts almost 1,200 active distribution centers covering 376 million square feet. For comparison, Walmart operates close to 200 active facilities with less than half the square footage.