The company's shipping costs jumped 23% last quarter.
6 Feb, 2019FORTUNE.COM
Is there anyone who Amazon isn’t competing with?
In a recent regulatory filing, amzn Amazon added “transportation and logistics services” to the already long list of industries and services it views as competition. While Amazon relies on shipping partners, like USPS, UPS, and FedEx to help make deliveries, the disclosure signals that Amazon is getting serious about making its mark with its own delivery service.
“The worldwide marketplace in which we compete is evolving rapidly and intensely competitive, and we face a broad array of competitors from many different industry sectors around the world,” Amazon said in the annual filing.
Amazon’s shipping costs were $9 billion, according to its most recent earnings report. That’s a 23% increase from the previous quarter, but shows just how much customers value Amazon Prime’s free shipping options. Amazon has already taken some steps to build a delivery infrastructure to supplement its partners. The company leased a fleet of airplanes to carry cargo, has delivery vans, and has been piloting a “Shipping With Amazon” program, which entails drivers picking up packages from third party sellers and delivering them.
There has also long been speculation about whether Amazon, one of the world’s most valuable companies, might consider a surprise acquisition of a transportation and logistics competitor. UPS CEO David Abney said last month that while Amazon is a customer, he also sees the company as a competitor.
Amazon CEO Jeff Bezos has always been fascinated with finding ways to revolutionize delivery. He shared his vision for drone delivery in 2013. Bezos predicted it would be a reality by the end of 2018, however the program has hit regulatory snags in the United States. Amazon made its first commercial drone delivery in Cambridge, England in December 2016. They’re also deploying delivery robots. Last month, Amazon unveiled its new Scout delivery robot, which is making test deliveries in a neighborhood in Snohomish County, Wash.