I hate to bust your bubble but FedExx doesn't have anything close to 660 aircraft. Out D085 lists around 360 aircraft

The 2017 Annual Report shows 657 aircraft in the FedEx Express Aircraft Fleet....which includes feeder aircraft.

https://about.van.fedex.com/newsroom...ircraft-fleet/

The 600 number includes FedEx owned feeder aircraft.

I don't tell anyone how to vote, who to watch or what to read. If that makes me a straw man, so be it.

FDX employs an army of full time couriers to staff so called last mile delivery logistics. That component is said to account for up to 30% of doorstep shipment cost. If a competitor succeeds in Uber-ing that number down, they create an advantage the others cannot ignore.

AMZN's transportation & parcel handling initiatives will succeed or fail on their own merits. A compelling enterprise drama it is. Financial performance during the next economic cycle trough will be telling. Not to mention share value as colossal bills for what they're attempting mount.

My money isn’t on amazon going it alone, nor buying ups or fed ex.
Look what there doing in Cvg. Dhl is the worlds biggest international delivery outfit and pretty much all night they work and everything sit idle during the day. Amazon are using Cvg in the day not at night. DHL’s biggest customer? Amazon. Put them together what have you got over night....watch the space instantly amazon have a worldwide proven time definite delivery system to over 220 countries using an existing system that’s already in place...and using the assets at opposite times. It’s just a question of when they merge

No way they will touch ups or fed ex, the management way of doing things at Dhl and amazon are so similar. look in Europe where all the amazon warehouses are popping up right next to the airports where Dhl are a big air operator..

I doubt Amazon would buy DHL just because of the international regulation that would come from that. However I can see them basically doing a joint venture of sorts.

One of DHL's biggest obstacles in the US is that they're a foreign entity and therefore can't own a US transportation system. They can rely on 3rd party carriers like they are but that can only take you so far. No way even Atlas could find enough financing to get the airplanes needed since they have only a 5 year contract to back up the financing (versus FedEx and UPS which have their own business as proof that flying won't just dry up overnight and leave aircraft lessors holding the bag).

However here's Amazon with a need for a transportation network and the finances to make it happen. What they don't have is access to international markets which no amount of money can be bought overnight.

Amazon could build as big a network as it wants in the US since it's a domestic company which will help DHL penetrate that market. Amazon can use DHL's international presence both to sell internationally but also to bring goods in from China and the rest of the world. You could ship a DHL box that would ride on an Amazon jet to CVG and out to the rest of the world and Amazon can bring a pallet of stuff from China using DHL's existing network. Consider it a codeshare for boxes.

I don't think FedEx and UPS have much to worry about until Amazon starts to sell excess freight to other companies at or below cost. I think this will very much follow how Amazon became a leader in cloud computing where they had all this excess computing capacity for their online store which they sold to other companies for cheap. In a way they could have this entire transportation system paid for by everyone else and thus their own shipping costs are zero or even below zero (if they decide to make money on it). It'll be pretty hard for a profit-oriented FedEx or UPS to compete with an entity that doesn't have to make money so much as reduce its own costs.

Just a small correction: Atlas has a 7 year contract to operate the aircraft; but more importantly, Amazon agreed to sign 10 years leases on each aircraft that Atlas (Titan) acquired to operate. So there is a 10 year lease to back up the financing.

Otherwise, I agree with everything in your post, especially that Amazon doesn't need to make money on their transportation system, they just need to spend less than they are paying FedEx and UPS to operate the transportation system for them.

Eh its all semantics. Point being that an ACMI has only a contract for lift or at best a track record of finding work when a lessor agrees to buy them an airplane. That's fine when you're talking about a few dozen airplanes spread out amongst several contracts. However good luck getting Wall Street to agree to buying say, 100 airplanes on an ACMI contract of any length. If Amazon kissed Atlas or ABX goodbye there would be no way those companies or the underlying leasing firms could find a use for all those jets. If outsourcing was the way to go you can bet UPS and FedEx would of cracked that nut long ago.

Ups had the nut cracked for a loooooooooooooooooooong time but the Feds had them seal it with the help of FedEx.

Back in the day a mathematician observed a bunch of people trying to guess the weight of a cow at a county fair. The farmer whose guess came closest won the beautiful bovine. Nobody guessed anywhere near the correct weight of the cow. However, when the mathematician averaged the guesses, he found that the median guess was almost exactly correct.

At the next county fair, while farmers were guessing the weight of a prize pig, the mathematician jotted down the guesses for the pig’s weight, averaged them and submitted that number. He won a gorgeous, well-mannered pig!

My point is we can be that pig-owning math-nerd!

A very large number of Atlas pilots are waiting for a call from UPS. Still more have left for FedEx. That said a sizeable minority of young and qualified pilots have chosen to stay and wait to see how contract negotiations and other things play out.

Based on the deliberate decisions of our peers, I’d say the odds are next to nil that we will see Amazon put UPS or FedEx out of business. We will likely, however, see Amazon rise to ant equal or near-position over the next decades. From a pilot’s perspective people generally see a more lucrative and stable future at UPS or FedEx, but that could change in the very long term.