Pilots and aircraft are the simplest part. In addition, you need all the supporting equipment at every airport to load/unload, sort and transfer freight from aircraft to ground vehicles. Then you need the manpower and vehicles to distribute packages to every house and business in every country Amazon intends to deliver. It has taken FedEx 45 years to develop its infrastructure. It employs over 300,000 people around the world. It has taken UPS 108 years and it employs over 400,000 people around the world. Just for delivering packages. And somehow Amazon expects to develop that kind of infrastructure in 5-7 years? If they actually plan to deliver all their own stuff, they can't do it half-assed. What's their business model going to look like for areas outside of major cities? "Sorry remote farm family in Nebraska, you can buy things on our website, but since you live outside our delivery network, you'll have to drive to Omaha to pick them up".
I think Amazon is playing poker. They want a better deal and they are making some noise. Good move on their part. It's getting noticed. But unless they have the capital to buy UPS or FedEx, they are decades away developing any kind of package delivery system capable of delivering their own stuff, never mind competing with FedEx/UPS.

 

Amazon doesn't have to deliver to every house in the US they only have to replace the trunk network FedEx/UPS is providing to the Postal Service distribution centers. The airplanes would only have to deliver packages to major hubs then semi-trucks (which has already been announced) to the regional USPS offices. Even then if it doesn't make sense I'm sure FedEx/UPS will do just fine, they're only going to take the low-hanging fruit that will provide the best cost savings.

 

Oh now you've done it. Every under-employed non-schedder and hipster dufus Bezos fanbois is going to get up in your grill.

I'll be amused in say two years when the guys that would now service Bezos' dog to get a job from him will be on this board clamoring for a union and cursing his existence. Bezos is going to pit groups against each other and drive wages down for everyone without a real contract/Union in place.

 

Maybe not yet but it's getting closer...

Amazon is now worth WAY more than Walmart - Jul. 24, 2015

 

Funny, A simple rumor of Amazon having its own air freight has people running scared. There are so many reasons why it won't happen. A wishful thought of starting your own delivery system is a long way from DC politics and getting it approved.

 

[QUOTE=iPilot;2045184]Amazon doesn't have to deliver to every house in the US. Yes they do. And FedEx, UPS would fight Amazon at every turn. Its funny, but there are only two major delivery carriers in the US and they are UPS and FedEx. They own the market. Amazon can dream about trying a delivery service but both UPS and FedEx would match Amazon delivery prices and kill a start up. Both FedEx and UPS have large revenues outside of Amazon.

 

[QUOTE=Waldorf;2045223]My changes are in red

 

Double post. See below

 

Amazon isn't creating a common-carrier freight company. They just want to cut out the middle-man and ship their own stuff.

Right now they use the post office for most last-mile deliveries to residential addresses. All Amazon has to do is ship packages into the USPS system. Most likely the jets and semi-trucks will deliver to regional post offices and the USPS takes it from there. Granted that isn't a small matter and they'll likely continue to use FedEx and UPS where it makes sense. Perhaps this is just a negotiating tactic on Amazon's part to get cheaper shipping rates. I imagine Bezos writes those guys a pretty big check that he'd like to keep to himself.

 

There's a reason why the USPS contracts out much of the kind of shipping you are talking about. It sounds kind of simple until you actually witness the process. But if it were a cheap and easy process, it would have been one of the last things the money losing Post Office would have shed. Instead, it was the first.