Will Amazon Become the Next UPS?

Amazon has become one of the wealthiest companies in the world thanks to its ability to deliver practically anything just about anywhere. That said, it shouldn’t come as any great surprise that the delivery giant has finally taken the first leap toward creating its own fleet of aircraft.

This week Amazon announced plans to purchase 11 Boeing 767-300s, seven from Delta Air Lines and four from Canadian WestJet. An Amazon spokesman says the carrier believes the fleet will grow to more than 85 aircraft by the end of 2022. Until now, all of Amazon’s aircraft flying under the Prime banner were leased. A January 5 Bloomberg story said, “As Amazon has built up its own delivery operation, which includes tens of thousands of cargo vans, the company has gone out of its way to highlight its continued reliance on other cargo companies. But Amazon already handles most of its own deliveries and has emerged as competitor to partners that only a few years ago delivered almost all of the company’s goods. FedEx Corp. in 2019 said it wouldn’t renew its air-delivery contract with Amazon. A report last year estimated that Amazon’s fleet would likely grow to 200 aircraft in the coming years, rivaling UPS in size.”

In a Forbes story, Amazon said it will “continue to rely on third-party carriers to operate these new aircraft.” Companies operating Amazon’s aircraft include Sun Country Airlines, Atlas Air and ATI. MarketWatch spoke to Sara Rhoads, Vice President of Amazon Global Air who said, “Having a mix of both leased and owned aircraft in our growing fleet allows us to better manage our operations, which in turn helps us to keep pace in meeting our customer promises.”