sherpster

This is going.to be the biggest whipsaw in the history of aviation. Pilots/companies will be falling all over themselves to get a piece of the action.

baldwin

great question.

FlyAstarJets

ABX scope protection prohibits any other ATSG company from operating 767 aircraft out of CVG in the service of DHL only.

Kougarok

Did I miss something? Where in the press release does it say Amazon is going to use DHL facilities?

wjcandee

I think that a good lawyer might be able to have some fun with the concept of what is meant by "DHL" in that scope clause if Amazon, which is not an airline, is using their facilities. On its face, it's not a winning argument, but the devil (and devilish fun) of this stuff is in the details...

wjcandee

It's in this lengthy article (you have to click on "read full article"), stating that they're gonna move in the spring and use DHL's facilities while they build a 3 million square foot building and parking for 100 aircraft. http://www.bizjournals.com/cincinnat...ub-at-cvg.html

I also think that if they're talking about facilities this ambitious and a fleet that large (although nothing says that they have to be all widebodies), you are necessarily looking at some new-build freighters for the further-out additions, and the idea of bringing at least some of the lift in-house in the long term starts to look more likely, even given the company's antipathy towards unions. 100 parking spaces means a fleet larger than that. Fully one-third of current Amazon routes bypass ILN. Who knows whether that percentage would stay constant, but plainly the ability to build pallets at origin that are all going to one destination means that no sort hub is needed for most of the freight, and Amazon does seem to like these point-to-point routes. So 100 spaces at CVG could mean 150 routes. Of course, this is all pie-in-the-sky regardless of what the public officials are currently crowing, and this gets much harder to do -- not easier -- as it scales up. Only 15 routes are currently-running, with five of them bypassing the "hub".

Let's see how much they like operating this thing when they get to 25 aircraft with three carriers, and then to 40.

FlyAstarJets

I have to disagree. The only winner in that argument are the lawyers racking up the billable hours in a losing cause. In service of DHL means moving DHL product (their freight) in a 767 contracted by DHL. All DHL is doing for Amazon in the short term, is renting out their infrastructure to Amazon, nothing more

wjcandee

The Amazoners probably weren't considering stuff like this, or at least appreciating some of the not-immediately-obvious advantages of having your own airport.

Kougarok

Ahh OK thanks. Well at least it'll make my commute easier. I am really, really looking forwards to retirement....

wjcandee

Which happens all the time in employment cases, because a successful outcome isn't necessarily defined as winning the case (assuming that the argument isn't completely-frivolous), but is often defined as creating leverage through uncertainty, and a benefit can even be found when the end result is just lengthy disruption and uncertainty.

Also happens all the time in cases challenging statutes. Just because something is a stretch doesn't mean that making the argument will not serve a purpose.

And when I say the devil is in the details, I'm assuming that we don't know what the actual arrangement will be. Suppose Amazon doesn't just make some arrangement for use of real estate. Suppose that DHL insists that it must provide certain personnel and services in conjunction with Amazon's use of its building and ramps -- which isn't too farfetched given that there are other stakeholders here, like insurers, and we don't know what DHL's contracts with its vendors provide. All of a sudden, maybe there is something there.

Again, I'm just spitballing, and you're probably right.