Monday, December 28, 2015

WILL AMAZON EXAMPLES REVERSE LOGISTICS OUTSOURCING BY SOME FIRMS?

Amazon in secret move to launch own European air freight service

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Amazon has been operating secret flights carrying thousands of packages in and out of the UK for the past six weeks as it trials setting up its own air freight business.
The Evening Standard can reveal that since mid-November the online retail giant has chartered a Boeing 737 to fly between Poland, the UK and Germany.
The plane has made five trips a week, flying from Katowice in Poland to Luton, East Midlands or Doncaster airports and then back to Poland via Kassel in Germany.
The round trips link several of Amazon’s biggest fulfilment centres in Europe.
Katowice airport is near its two giant warehouses in Wroclaw, which together cover 190,000 square metres or 26 football pitches.
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      Amazon warehouse gears up for Black Friday
      Kassel is the closest airport to Amazon’s two fulfilment centres in Bad Hersfeld, Germany, which together are the size of 24 football pitches.
      Amazon’s biggest fulfilment centres in the UK are in Dunfermline (14 football pitches) and Swansea and the closest to London are Milton Keynes and Hemel Hempstead.
      Amazon has chartered the plane from German logistics firm DB Schenker and is understood to be looking at extending the trials with further plane charters and taking in centres in Spain and Italy.
      First trials in this country were to Luton airport and then  East Midlands and Doncaster.
      The move to flying its own parcels around Europe echoes the firm’s strategy in the US, where it is reportedly negotiating to lease as many as 20 Boeing 767s after successful air trials in Wilmington, Ohio.
      News that Amazon is building an  air cargo business will be a blow to traditional air freight carriers such as UPS, DHL and FedEx, which have traditionally carried the bulk of its intra-continental business.
      “Amazon is pretty fed up with the third-party carriers being a bottleneck to their growth,” said Colin Sebastian, an analyst at Robert W Baird.
      UPS-plane.jpg
      Amazon is reportedly easing its ties with shipping firm UPS (Picture: Reuters)
      Moving into air freight would be a logical step following on from Amazon’s build-up this year of its own fleet of delivery vans and couriers in the UK
      It has moved to secure more of its own distribution network after one of its carriers, CityLink, went bust last Christmas.
      Asked about the aircraft charter in Europe, an Amazon spokesman said: “Within our European fulfilment network, we use various carriers with a range of transport methods for distributing and delivering items. This includes air.”