Amazon Air recently announced its expansion in terms of aircraft. By this, it will no longer be dependant on FedEx, UPS or USPS. The plan is to add a vast number of aircraft fleet for the cargo purposes of Amazon Air. The announcement states 10 more planes over the period of next two years.
FedEx and UPS hold a huge customer base with Amazon’s delivery service. And this step might cause them a loss to a large extent. The planes which will be a part of this aircraft fleet are Boeing 767-300, leased from Air Transport Services Group, which is already renting 20 crafts.
That Requires a Large Space Too!
With a large number of aircraft, Amazon will be needing a large area at airports too for the cargo facility. It has announced to build a separate area for the cause on different locations and planned to expand from 72,000-square-foot to 200,000 square feet.
The same expansion plan is reserved for Kentucky International Airport for up to three million square feet. The news was also on a verge that Amazon may provide a separate third-party courier service as a competitor to FedEx and UPS. Tough that isn’t a fair competition because Amazon itself is loaded with tons of orders.
The difference will not be observed on Amazon’s side, in fact, they will be able to generate savings by not relying on external parties. Yet these third-parties will suffer a lot. Amazon occupies 3 to 5% of FedEx’s whole revenue, and for UPS the figure is around some teens.