AN independently produced review of amazon Air's initiatives by the Chaddick Institute for Metropolitan Development at Depaul University shows that e-commerce giant Amazon may soon be ruling the cargo skies with its Prime Air criss-crossing the globe, outpacing giants like Fedex and UPS.
Amazon Air's fleet, now reportedly 88 planes, could surpass 100 by the end of 2022, 'a notable achievement considering the modest slowdown in economic growth underway and dramatic increases in jet fuel costs', says Chaddick Amazon Air Brief No 6, reports Mumbai's STAT Trades Times.
The brief, authored by Joseph P Schwieterman, Borja Gonzalez Morgado and Abby Mader, says: 'Although our prediction roughly 20 months ago that Amazon Air would have 200 planes by 2028 was speculative, it remains in our view reasonable. In fact, it may be conservative, considering that Amazon Air is now acquiring turboprops and that, when the partner network is included, it may already account for more than 110 planes regularly in service.'
With 2021 revenue of US$497 billion and logistics spends of over $150 billion, Amazon, very nearly, has no comparison in any logistics space - air, sea or land.
'Amazon's logistics costs have skyrocketed over the past decade with shipping and fulfilment costs growing almost 40-fold between 2009 and 2021, according to this report from Statista. '
Last year alone, the company's shipping costs, which include sortation and delivery centres and transportation costs, amounted to $76.7 billion with fulfilment costs adding another $75.1 billion to a hefty logistics bill. While Amazon's revenue also grew more than 20-fold since 2009, that wasn't enough to offset the surge in logistics costs. In 2009, shipping and fulfilment costs amounted to 15.6 per cent of net sales. By 2021, that share had risen to 32.9 per cent.'
Amazon Air, a cargo airline operating exclusively to transport Amazon packages, changed its name from Amazon Prime Air in 2017 to differentiate from its autonomous drone delivery service. The Prime Air logo, however, remains on the aircraft.
Amazon Air has increased flight activity by another 14 per cent, not including added lift by partners, and invested heavily within Europe with Irish partner ASL expanding flights to more than 38 daily, the Chaddick brief said. It has emphasised scheduling in narrow time intervals at its Cincinnati (CVG) and Wilmington, OH hubs. It has also expanded its network to be within one hundred miles of 73 per cent of the US population; and began using turboprops, giving it greater capability for third-party shipping.
'The owned subsidiary of retail giant Amazon made notable moves during autumn 2021 and early 2022 that gave it a stronger presence in Europe and put it in a position to challenge FedEx and UPS for certain kinds of business,' says the Chaddick Amazon.
'Amazon Air's intra-Europe operations grew from eight to 18 daily flights from August 2021 to March 2022 even while a much larger network of partner flights involving planes that are not registered to Amazon Air emerged. These complementary networks appear to now encompass around thirty-eight daily flights serving eight cities. Many partner flights operate with Boeing 737s that its contractor, ASL Airlines, acquired during an autumn growth spurt.'
The analysis found that Amazon Air increased daily flights from 164 in August 2021 to 187 flights this month, a 14.3 per cent increase 'based on our review of five representative days of operations.
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Amazon Air's fleet, now reportedly 88 planes, could surpass 100 by the end of 2022, 'a notable achievement considering the modest slowdown in economic growth underway and dramatic increases in jet fuel costs', says Chaddick Amazon Air Brief No 6, reports Mumbai's STAT Trades Times.
The brief, authored by Joseph P Schwieterman, Borja Gonzalez Morgado and Abby Mader, says: 'Although our prediction roughly 20 months ago that Amazon Air would have 200 planes by 2028 was speculative, it remains in our view reasonable. In fact, it may be conservative, considering that Amazon Air is now acquiring turboprops and that, when the partner network is included, it may already account for more than 110 planes regularly in service.'
With 2021 revenue of US$497 billion and logistics spends of over $150 billion, Amazon, very nearly, has no comparison in any logistics space - air, sea or land.
'Amazon's logistics costs have skyrocketed over the past decade with shipping and fulfilment costs growing almost 40-fold between 2009 and 2021, according to this report from Statista. '
Last year alone, the company's shipping costs, which include sortation and delivery centres and transportation costs, amounted to $76.7 billion with fulfilment costs adding another $75.1 billion to a hefty logistics bill. While Amazon's revenue also grew more than 20-fold since 2009, that wasn't enough to offset the surge in logistics costs. In 2009, shipping and fulfilment costs amounted to 15.6 per cent of net sales. By 2021, that share had risen to 32.9 per cent.'
Amazon Air, a cargo airline operating exclusively to transport Amazon packages, changed its name from Amazon Prime Air in 2017 to differentiate from its autonomous drone delivery service. The Prime Air logo, however, remains on the aircraft.
Amazon Air has increased flight activity by another 14 per cent, not including added lift by partners, and invested heavily within Europe with Irish partner ASL expanding flights to more than 38 daily, the Chaddick brief said. It has emphasised scheduling in narrow time intervals at its Cincinnati (CVG) and Wilmington, OH hubs. It has also expanded its network to be within one hundred miles of 73 per cent of the US population; and began using turboprops, giving it greater capability for third-party shipping.
'The owned subsidiary of retail giant Amazon made notable moves during autumn 2021 and early 2022 that gave it a stronger presence in Europe and put it in a position to challenge FedEx and UPS for certain kinds of business,' says the Chaddick Amazon.
'Amazon Air's intra-Europe operations grew from eight to 18 daily flights from August 2021 to March 2022 even while a much larger network of partner flights involving planes that are not registered to Amazon Air emerged. These complementary networks appear to now encompass around thirty-eight daily flights serving eight cities. Many partner flights operate with Boeing 737s that its contractor, ASL Airlines, acquired during an autumn growth spurt.'
The analysis found that Amazon Air increased daily flights from 164 in August 2021 to 187 flights this month, a 14.3 per cent increase 'based on our review of five representative days of operations.
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