Dive Brief:
- Amazon Air may take a 40% stake each in two air cargo firms — Atlas Air Worldwide Holdings and ATSG — over the next four years, according to an SEC filing reported by Freight Waves and the Loadstar. ATSG and Atlas currently operate Amazon's 40-aircraft fleet.
- Amazon was granted warrants to purchase up to 20% of each company in 2016 when the relationships began, and the March 27 filing doubles that potential stake.
- Amazon additionally entered seven-year leases for five B737 aircraft through Atlas, with the option to add 15 more.
Dive Insight:
The main takeaway from the ins and outs of Amazon's air cargo dealings is that the company is extending leases, growing its fleet and heading toward ownership of a larger slice of the air cargo pie.
The size of the warrants is tied to the amount the company pays the two operators and therefore increases incrementally as the relationships progress.
Amazon watchers first got a whiff of the new planes when Amazon's senior vice president of operations Dave Clark tweeted a photo of the new 737 in Prime Air livery on March 19.
Welcome to the fleet!
— Dave Clark (@davehclark) March 19, 2019
The company has previously exclusively flown B767 aircraft, so adding the smaller B737 adds variety and efficiency to its fleet.
Though the company has recently sent mixed messages on the purpose of its internal logistics services, entrenched players continue to dismiss it as serious competition.
