Amazon.com Inc. is beginning air freight services in India, expanding in Asia even as slowing online sales growth prompts cost cuts elsewhere.
(Bloomberg) — Amazon.com Inc. is beginning air freight services in India, expanding in Asia even as slowing online sales growth prompts cost cuts elsewhere.
The Seattle-based e-commerce giant began using cargo capacity in a Boeing 737-800 aircraft operated by partner Quikjet Cargo Airlines Pvt on Monday, and will begin making shipments via a second plane on Tuesday, Sarah Rhoads, vice president of Amazon Global Air, told Bloomberg News.
“India is really exciting. It’s an indicator of all the potential out there,” Rhoads said during an interview in Hyderabad, southern India at an event to launch the service. “The two aircraft are a start.”
Amazon Air will begin shipments in Hyderabad, Bangalore, New Delhi and Mumbai, said Akhil Saxena, vice president of customer fulfillment.
The launch in India comes as Amazon tries to sell unused space in its cargo jets, in a bid to adjust to a post-pandemic slowdown that has forced it to cut 18,000 jobs around the world.
Demand for air cargo has cooled, with the sector projected to slow down further this year. Amazon has a fleet of more than 110 planes flying to more than 70 destinations worldwide, Saxena said. The company is offering space on its planes and charter flights, on top of plans to sublet excess warehouse space.
“Not every single flight is full every single day,” Rhoads said. “We didn’t procure all sorts of capacity all over the globe and hope to fill it up. We use a lot of data and math to make our decisions.”
Amazon began its air cargo service in 2016, in what was soon seen as a challenge to United Parcel Service Inc. and FedEx Corp. Amazon Air operates out of small regional airports close to its warehouses, helping the company meet orders for one- and two-day delivery.
(Updates with Amazon Air executive comments)
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