Report: Amazon in Talks to Lease 20 Boeing Jets to Potentially Launch Air Cargo Service
Look out UPS, DHL and FedEx. There are reports that the ecommerce powerhouse is looking to soar into the air-delivery market, potentially aiming to dominate its entire distribution network.
Opinions expressed by Entrepreneur contributors are their own.
Amazon might soon soar into the air cargo business. The online retail giant is in negotiations to lease 20 Boeing 767 freighter jets with the aim of launching its own air cargo service, according to reports from several media outlets, including VICE's Motherboard, The Seattle Times and Cargo Facts.
The world's largest ecommerce outlet is reportedly looking to create its own air-delivery operation to curb shipping bottlenecks from third-party carriers, a cargo industry analyst told the Times.
Related: Amazon Releases Video Showcasing Delivery Drones
If Amazon's reported negotiations with Boeing are indeed real and subsequently successful, the pivot would fly in the face of existing international cargo operators that move the company's cargo, such as FedEx, DHL, UPS and USPS. Owning its own air cargo arm would enable Amazon to dominate its entire distribution network, end to end. It could potentially end Amazon's reliance on third-party air-cargo suppliers altogether.
The Seattle Times also reports that Amazon has discussed leasing cargo planes with several aircraft lessors, including Atlas Air, Air Transport Services Group and Kalitta Air, though Kalitta Air denied the alleged talks.
Entrepreneur reached out to Amazon and Boeing to confirm the reports. Both companies replied, but declined to comment.
Related: Amazon Has Literally Gone Bananas
You might recall that at the height of last year's holiday shipping season, UPS was unsuccessful in delivering millions of its parcels on time, many of them items ordered on Amazon. In response to UPS's widespread fail, Amazon took a hit and refunded UPS shipping fees. It also threw in $20 gift cards in an attempt to pacify angry customers.
More recently, Amazon has increasingly ramped up its efforts to streamline its shipping operations across the board, rolling out initiatives such as Amazon Prime Now, Amazon Flex and Amazon Fresh. Also front and center in its ambitious package delivery plans is Amazon Prime Air, an unmanned drone program that would courier small packages to customers within an hour, though it won't deliver a thing without FAA approval first.
Related: As Amazon Prime Becomes More Popular, the Threat to Walmart, Target Grows