You could see this happening from a mile away. FedEx and UPS is going to be in for some real competition. http://www.seattletimes.com/busines...20-boeing-767s-for-its-own-air-cargo-network/
yep - amazon is only 4% of UPS' volume makes sense for them to do this. It cost them 1.8bn last year in shipping losses.
Spot on. The long term implications of this are significant for both Fedex and UPS. Ths potential loss of Amazon's current spend as a percent of their revenues is the least of their worries.
Amazon rules! The only downer is that they are putting a distribution center in my state (Colorado) and I'll have to start paying sales tax.
Why do I think FedEx and UPS are in trouble? Aside from the revenues leaving them from AMZN (which are relatively higher margin) there is the eventual competition from the AMZN delivery service and the difficulty in competing against a company that investors value at over 400 P/E ratio compared to 20-30 for FedEx and UPS. AMZN as it stands has more freedom to spend all of their cashflow into a project like this compared to the others who will be pressured to return more of their cash to the investors rather than reinvest it in their existing business.
looks like the competition just got serious for shipping companies, interesting to see how well this plays out