News broke late last week that Amazon.com has been engaged in conversations to lease cargo airplanes and develop its own freight operation. The Amazon executive team seems to have decided that it wants Amazon to have more direct control over delivery and shipping operations, and other trials (such as the door to door drone delivery program) which seem to suggest the same are already underway.
The goal is to reduce its reliance on other vendors to transport product around the world, as well as eliminate an additional segment of expense in its existing operation. Having had wild success with the transition from third party warehouse facilities to operating its own, the play seems like a good move and the company has proven its ability to execute such transformations. While a transition like this could mean improved control, better delivery expectations, more profits and a win for shareholders, a transition like this must take time. Most air cargo companies that operate their own fleet of aircraft not only must develop their own maintenance teams, but they have to train pilots, obtain clearance from the FAA, and develop the infrastructure needed to support such big operations. As such, experts expect any kind of significant change to take years.
