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HomeUS NewsContractor says Amazon seeks again air cargo service

Contractor says Amazon seeks again air cargo service


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An Amazon-branded Boeing 767 freighter, nicknamed Amazon One, flies over Lake Washington throughout the Seattle Seafair Air Present on August 5, 2016 in Seattle.

Getty Photos

one in all AmazonMain US air cargo operators on Monday stated the e-commerce big is slashing flights this 12 months citing low demand and sluggish financial development.

Air Transport Providers Groupwhich runs a good portion of Amazon’s air cargo fleet, stated it expects to work boeing The 767 freighters are devoted to servicing Amazon and DHL on quick schedules and quick flight instances per plane.

“Each firms are adjusting their floor and air distribution and success networks in america according to decrease US financial development and shopper spending ranges within the first half of 2023,” ATSG stated.

Air cargo charges, which have risen in recent times as a consequence of port congestion and excessive demand for sooner supply, have declined. The Baltic Air Freight Index was down greater than 33% on January 30 from a 12 months earlier. The Worldwide Air Transport Affiliation stated final month that air cargo demand in November was down about 14% from the year-ago interval, whereas capability fell 1.9%.

In the meantime, passenger airways have stated demand for journey has elevated as shoppers prioritize visits and different experiences.

However after Amazon’s weakest 12 months for development in its quarter century as a public firm, CEO Andy Jassy has taken steps to cut back bills. This contains reducing greater than 18,000 jobs, halting growth of warehouses and shutting some initiatives.

Amazon constructed up its success and logistics community at a frantic tempo throughout the COVID pandemic as e-commerce demand surged. Since then, rising inflation and a slowdown in shopper spending have pressured Amazon to downsize. Bloomberg reported final December that the corporate weighed promoting further area on its cargo planes to different airways.

The ATSG stated on Monday that Amazon might not prolong its lease on 5 Boeing 767-200 freighters, that are as a consequence of expire between Might and September. Amazon has an choice to proceed leasing the 4 767-200s by 2024, it added.

Shares of ATSG had been down 9% in afternoon buying and selling. Amazon shares fell practically 1%. A consultant for ATSG didn’t reply to a request for remark.

Following publication of this story, an Amazon spokesperson stated in an emailed assertion that claims that the corporate is “decreasing flights” as a consequence of low demand and slowing financial development are incorrect.

“As a part of our annual planning, we routinely cut back our flight schedule at the moment of 12 months for post-holiday takeoff and plane upkeep,” the spokesperson stated.

Amazon employed Hawaiian Airways to fly massive, leased Airbus cargo jets in October and stated it could retire a number of the older planes.

By way of Amazon Air, the corporate has constructed a rising air community to regulate extra points of the supply course of and guarantee sooner deliveries. It invested in ATSG and Atlas Air Worldwide Holdings, though Atlas agreed to be taken non-public by an investor group final 12 months. Amazon additionally tied up with passenger airline solar nation To supply crew and plane to fly the package deal. The e-retailer normally rents freight from its air contractors, however has additionally purchased used jets. Delta and WestJet.

Along with Amazon and DHL decreasing their air cargo schedules, the supply big FedEx, Has additionally introduced value cuts that embody parking plane and reducing some company jobs.

Watch: How the Pandemic Modified How Boeing and Airways Suppose About Air Cargo

How the Pandemic Changed How Boeing and Airlines Think About Air Cargo

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