An Amazon-branded Boeing 767 freighter, nicknamed Amazon One, flies over Lake Washington during the Seattle Seafair Air Show on August 5, 2016 in Seattle.
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one of AmazonMajor Air Cargo Operators of said monday Citing low demand and slow economic growth, the e-commerce giant is reducing flights this year.
air transport services groupwhich runs a significant portion of Amazon’s air cargo fleet, said it expects to work boeing The 767 freighters are dedicated to servicing Amazon and DHL on short schedules and short flight times per aircraft.
“Both companies are adjusting their ground and air distribution and fulfillment networks in the United States in line with lower US economic growth and consumer spending levels in the first half of 2023,” ATSG said.
Air cargo rates, which have risen in recent years due to port congestion and high demand for faster delivery, have declined. The Baltic Air Freight Index was down more than 33% on January 30 from a year earlier. International Air Transport Association Said Last month in November, air cargo demand was down about 14% from the year-ago period, while capacity fell 1.9%.
Meanwhile, passenger airlines have said demand for travel has slumped as consumers prioritize trips and other experiences.
but coming from amazon weakest year for growth In its quarter century as a public company, CEO Andy Jassy has taken steps to reduce expenses. Contains Cutting More than 18,000 jobs, halting expansion of warehouses and closing some projects.
Amazon built up its fulfillment and logistics network at a frantic pace during the COVID pandemic as e-commerce demand surged. Since then, rising inflation and a slowdown in consumer spending have forced Amazon to downsize. The company has undertaken to sell additional space on its cargo planes to other airlines, Bloomberg Reported last December.
The ATSG said on Monday that Amazon may not extend its lease on five Boeing 767-200 freighters, which are due to expire between May and September. Amazon has an option to continue leasing the four 767-200s through 2024, it added.
Shares of ATSG were down 9% in afternoon trading. Amazon shares fell nearly 1%. Representatives for both companies did not immediately respond to a request for comment.
Amazon in October hired out Hawaiian Airlines to fly larger, chartered Airbus cargo jets, and said it would retire some older planes.
Through Amazon Air, the company has built a growing air network to control more aspects of the delivery process and ensure faster deliveries. This Investment in ATSG and Atlas Air Worldwide Holdings, although Atlas agreed to be taken private by an investor group last year. Amazon has also tied up traveler airline sun country To provide crew and aircraft to fly the package. The e-retailer usually charges freight from its air contractors, but it also bought used jet from Delta and WestJet.
In addition to Amazon and DHL reducing their air cargo schedules, delivery giants FedEx, also announced cost reductions that include parking aircraft and cut some corporate jobs,
Watch: How the Pandemic Changed How Boeing and Airlines Think About Air Cargo