Amazon in talks to lease Boeing jets to launch its own air-cargo business | The Seattle Times

Article references the blog that mentioned this thread, so I guess APC is becoming a more and more legit source of news

their their their . Just for you ;)

DHL were not hauling their own freight. They were dependent on the overflow from UPS and FedEx. Amazon is the supplier and the shipper.

Like someone else said, 3 billion in cash buys a lot of airliners and trucks. I worked in operations for one of the first UPS contractors when I was finishing college. UPS started small in air freight. Look where they are now. I would not discount this plan from working.

wat?

ABX and Astar weren't hauling packages with DHL labels?

I've got some beachfront property in Nebraska for sale if anyone is interested.

Oh land of ten thousand lakes, awesome, I'm in!

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I flew there 12 years. Never flew any UPS or FEdEx "overflow". All DHL packages.

I think he means that Amazon wants to cut out the middle man. FEDEX, UPS, and DHL are the middle man. I wonder how much they can save? I guess we will find out.

I am very positive about it! Like I said I am cautiously optimistic. :)

Who wants to take bets on when the furlough notices start to appear at UPS?

Never mind, nothing to see here,

carry on......

Walmart has a bad name because they put mom and pop stores out of business.

For Amazon, they're killing major brick and mortar retailers of all types. They're also getting into food/groceries. Their goal is to handle nearly any SKU.

The question that must be asked, are we willing to watch Amazon take down so many sectors of the US economy while they in turn are hellbent on growing aggressively showing very little profit, thus paying very low taxes?

There's a lot of issues going on here and you don't have to be in the freight business to be a bit worried about Amazon.

Furlough the whiners. Tired of listening to them complain. Go to Amazon and you'll have something new to complain about, but you won't have union protection.

foregive me, but the collective group would VOTE on it. Mr Bozoes sorry, Bezo's would not dicktate it, sorry my bad, dictate it.

A threat to major cargo now, no! But you don't think he can get 100, 121 qualified dudes? He's already proven he doesn't care about throwing money away

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This appears to be a short term boom for ATSG using 767 aircraft but long term venture of obtaining their own operating certificate as referenced in this article from 2017 onwards.

Amazon May Lease 20 Boeing 767 Planes For Delivery - Investors.com

Pretty funny hearing a FDX pilot decry the death of Mom & Pop businesses wrought by all those evil Amazon boxes.

Mom & Pop businesses only existed and thrived in the US in the post-war era because they've been structurally/informationally protected from competition by geography, logistics, and price transparency.

Those barriers to competition have been broken by the internet and by the development of highly-efficient/fast parcel delivery networks (key players being UPS & FDX).

FDX & UPS represent the rapid shipping backbone enabling sellers from all over the planet (including Amazon) to compete with those darling Mom & Pop/Bricks & Mortar businesses on a cynical, cut-throat, price-only basis...your employer helped to destroy all of those little no-competition zones within which Mom & Pop businesses thrived for decades/centuries before.

Don't get me wrong--I'm one of those guys who still loves buying my shoes/clothes in person at a shop. I hate waiting for something to arrive even if it takes 2 days via Amazon Prime. I have my shoe guy, my car guy, my pest control guy, my local barber, etc.--I love the Mom & Pop shops in my hometown...just saying Amazon isn't any more or less responsible for the death of Mom & Pop retail than FedEx or UPS or the company who made the computer any of us are using to shop for xmas gifts this weekend.

Yes DHL LABELS, but on boxes of CUTOMERS who had a choice of shippers and which DHL had a habit of driving away!

With an Amazon system, it truly is THEIR freight, they would be both the shipper AND the customer, with no choice of selecting another shipper.

One research firm recently estimated such a venture could go well beyond simply saving Amazon shipping costs, but could become a $5B PROFIT stream.

Amazon isn't going inhouse. It's going to use contractors and probably multiple contractors. It's going to be like DHL on steroids in the US with various contractors battling for a piece of the Amazon action and Bezos playing contractors against another for the lowest cost.

Maybe but UPS was eventually forced to create their own airline. The author of this article quotes the Seattle Times as they will pursue their own AOC in 2017.
Amazon May Lease 20 Boeing 767 Planes For Delivery - Investors.com

Amazon wants to do it all. A difficult business model when the company has almost no margins.

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.

Similar statements were made when Southwest and Jet Blue were breaking into the market

The hubris is deafening.

Like when DHL decided to enter the US market.

Didn't know the Texas ANG had planes based in ILN.
https://farm8.staticflickr.com/7450/...f897d16a_c.jpg

This has exactly zero to do with why DHL failed in their attempt to enter the US market. Besides, as was already pointed out in this thread ad nauseum, this venture does not involve retail express package shipments. The only thing that they're taking away from Brown and Purple are their own packages.

They should repaint in Airborne colors and put on a stick the sole remaining 9 that been sitting on old D ramp for years.

https://farm4.staticflickr.com/3770/...58e17e43_c.jpg

Since Amazon is extremely low margin, Brown and Purple should welcome Amazon taking their stuff inhouse. It will free space on Brown and Purple jets for much higher yielding volume.

Why are some supposing that ACMI carriers couldn't/wouldn't fly for both DHL and Amazon.
It also seems that some are supposing that another freight airline means more freight.

None of the existing DHL contractors have enough planes to do both.

A fund, B fund; last men standing. I'd call it respect.

Oh, almost forgot, the lie flat seats:)

Hit the nail on the head...