Fitzgerald pointed out that FedEx has 700 planes, while Amazon only has 40.
“In a given week, Amazon flies 671 flights. The FedEx number of flights per week is closer to 13,000,” Fitzgerald said. “Amazon is a revolutionary e-commerce company, but that doesn’t mean that Amazon can just suddenly decide to become competitive with FedEx in transportation.”
Even losing Amazon’s business wouldn’t be that big a deal for FedEx, Fitzgerald said.
“Amazon is a longtime customer of ours. We’re proud of the partnership, but they’re not our largest customer. We actually recently specified that they represent less than 1.3 percent of our total revenue for 2018.” Fitzgerald said. “For our competitors, the percentage of revenue from Amazon is significantly higher.”
While FedEx said it’s not worried, Amazon itself seems to be worried about how these partners think about the relationship. When Amazon heard CNBC contacted UPS, FedEx and the U.S. Postal Service, it pulled out of a scheduled interview for this story.
In a written statement, Amazon said: “We are very happy to have the delivery capacity our carrier partners can provide. They provide a high quality service, and our own delivery efforts are needed to supplement that capacity rather than replace it.”
Northwestern’s Abdallah said Amazon is being cautious about revealing its ambitions.
“Without logistics, Amazon would not exist. So it’s very important for them to maintain close relationships with their third party logistics,” Abdallah said.
He added: “The next big thing in e-commerce is who figures out how to do this one-hour delivery or same-day delivery. This is very expensive, but whoever figures it out first will get a huge advantage in this market.”
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