Don't take my comment out of context. I never said FedEx/UPS were caused the death of Mom & Pop retail (you suggested that, and I disagree with that viewpoint).

Ecommerce is a relatively recent business model. Yes, shipping companies like FedEx and UPS make that possible. I don't think you can blame shipping companies for tearing down barriers of competition because I believe what is really going on here is these internet companies paying a lot less taxes and overhead.

FedEx and UPS have repeatedly said that business-to-consumer cargo is heavily discounted and creates a lot of operational issues and costs per package. Whereas, business-to-business freight which typically includes a large shipment to one business or business park, instead of hundreds of individually packaged boxes that need to go to different households.

In my opinion, what I think Amazon is trying to do is lower shipping costs by contracting a shipper to move "bulk freight" of packages between city pairs which can fill up an entire airplane, instead of shipping all of those packages individually on FedEx/UPS or other carriers (they use a lot more carriers than just FedEx/UPS).

But if that is not the case, and Amazon thinks they can start their own overnight delivery business, bring it. I must question the business model for a couple of reasons. First, it was Bezos in his own words that said very soon Amazon with have fulfillment centers located near 90% of the population and those centers will carry every SKU. So if that's true, why do they need to ship long distance via air carriers? Second, what is the business model? Fly an airplane full from a fulfillment center to a destination, then bring it back empty? Third, without carrying non-Ecommerce cargo, bulk freight, hazardous materials ecetera which pay the bills, I don't see how Amazon is going to make it work using packages which have high costs and yield little profit.*

But that's the rub (see the asterisk). Amazon doesn't like profit, in fact it avoids it by reinvesting the money back into the business, which is why they pay very little in taxes. Low taxes, no brick and mortar buildings to maintain, only adds to the aggressive growth strategy of Amazon.

So again I go back to my original point. As a society, are we willing to watch a company bring down multiple sectors of the economy while paying little in taxes because its legal?

I think even Trump said last week that if Amazon had to pay taxes like everyone else, they'd be out of business.

I'm all for innovation and competition, but we must ensure a level playing field for all those involved.

 

Thank you for your input, MEMbrain/Fegelein. The last time I looked, Mr. Bezos is a US citizen, and Amazon is a US company. As such, they don't have the same excuse that DHL had for "operating" in the US as they are now.

As the article states, getting an operating certificate would be the next step, either original, or buying that of an existing operator, ala UPS/IPX, 1988 style. Even if Amazon doesn't move (fast enough?) towards that action, does anybody think that Fed Ex and UPS would sit idly by, and let Amazon operate like that without cranking up their PAC to force Amazon to fish (go through certification process), or cut bait (revert back to being a customer) ?

 

Mayberry's long gone. The simple truth is the big 2 got it covered. Pretty good at it too as far as I'm concerned. Room for a stand alone AOC carve out? Wall street angst , shareholder hysteria, dogs & cats living together stuff if they aim too high & miss. Still, got to wonder what Amizonica is up to on the ground? Going Uber perhaps. The lawn mower guys story got my suspicions stoked. Are they listening in? Leaking here on purpose? OMG!

 

They have already started. It's at a smallish airport in Ohio. Not CVG or CAK

 

What would happen if Kalitta, Atlas, and ATSG stopped renewing their flying contracts for DHL and shifted to new CMI contracts for Amazon? Would DHL be able to replace the flying fast enough to keep up?

Amazon has three problems (in addition to many others): planes, pilots, and competition.

If Amazon can entice existing ACMI carriers away from DHL contracts, that solves the pilot problem and damages DHL. Amazon still needs to find planes... but CargoFacts is speculating that some of the ACMI carriers are already sourcing them and converting them.

I'm cautiously optimistic, but it is an exciting idea. "Gee Deutsche Post, we're having trouble staffing the airplanes with qualified pilots, might need to let some of that flying expire unless you want to convince us otherwise, financially." Let Kalitta, Atlas, and ATSG start whipsawing DHL; I'm not saying the pilots would ever see any of it, but it would be fun to watch.

 

Uncle Joe at ATSG has two perfectly good airlines already flying the 767 ETOPS. One with previous express airline experience. I am sure he would be perfectly willing to sell one of them for the right price. And lease 20-30 767's from CAM again for the right price. Problem solved for Mr Bezos! Just saying.....

 

Wow! Exactly what crossed my mind yesterday before even reading this post.

 

CVG is not in Ohio, FYI.

 

I'll date myself. The old Clinton County Air Force Base.

 

Yep F101 Voodoo gate guard and the ready hangars are used for calcium chloride storage now.