Does the Amazon Truck Fleet Threaten the Industry?
Published on Dec 23, 2019
Outsourcing carriers to move freight for you comes with many benefits. However, there comes a time when it makes sense to bring shipping tasks in house. Amazon is actively seeking to accomplish this by acquiring multiple truck fleets designed to move freight within a 400-mile radius.
With many CDL drivers leaving the industry, specifically due to spending long hours on the road and uncomfortable living conditions, this new carrier movement philosophy has many wondering if the Amazon truck fleet threatens the logistics industry moving forward.
Truth be told, though, everything Amazon does has an impact on logistics. Whether it’s the introduction of Prime delivery services, expanding order fulfillment or just solving last-mile logistics hurdles, Amazon has been the industry leader.
However, the new Amazon truck fleet, built without sleeper cabins and designed specifically for short-range movement introduces a new concept. In today’s article, we’ll explore the facts about Amazon’s new fleet of short-range trucks that could signal a shift in supply chain movement in upcoming years.
The Skinny on Amazon’s New Truck Fleet
On October 10th, 2019, an article was published on BusinessInsider.comindicated that Amazon was indeed proceeding to put branded heavy-duty trucks on the road. These new trucks are manufactured by Volvo Trucks and are designed for medium-range cargo movements less than 400 miles. Additionally, it has been reported that Kenworth is likewise in the development of power units for Amazon’s new trucking fleet.
However, industry insiders are not surprised by the move to a fully-branded Amazon truck fleet.
In fact, in April 2019, Amazon teased this new concept by showing two tractor-trailers with the familiar Amazon logo. This, of course, next to their existing Amazon-branded fleet of air cargo solutions. The caption in the picture read, “Say hello to my little friend,” a nod to the movie Scarface.
The best part? The trucks are referred to as having “day-cabs”. This one differentiating factor allows them to complete short-range deliveries and pick-ups while complying with the ELD Mandate for hours-of-service requirements.
Currently, Amazon has 457 US-based facilities that serve as fulfillment and distribution locations. 160 of these locations are categorized as supplemental and return centers, fulfillment locations, while 151 are specific delivery stations.
What’s the Concept?
Essentially the thought behind Amazon's mid-range truck service is solving a problem that currently plagues transportation – the driver shortage.
At the heart of many carriers losing drivers is the frustration associated with long-range or FTL cargo movements. This often results in drivers being away from home for a significant period of time – usually living on the road. To save money, many carriers provide a ‘sleeper cab’ – which provides the drivers with an area to sleep in the truck.
Amazon’s new truck and mid-range pick-up and delivery platform is intended to attract current CDL drivers that are looking to transition to a more flexible role. They can complete most freight movement tasks within the 11 behind-the-wheel restrictions as mandated by the ELD resolution. Additionally, it brings their freight movement solutions – in house. This one simple shift can greatly cut operational costs, improve movement transparency, and operate the process with fewer delays.
However, where Amazon is going above and beyond all the other companies that do this exact thing. The eCommerce giant is taking things a step further by helping drivers to finance the lease or purchasing of these day-cab trucks to act as independent owner/operators.
Additionally, they are creating business-to-business partnerships with insurance companies, fuel discount/rewards programs and truck-stop operators such as Love’s.
This new program is a prime example of Amazon’s dedication to moving logistics forward. It’s a proactive solution that will help them better fulfill, provide jobs to CDL carriers looking to transition from over-the-road positions, and may introduce more owner/operators into the industry. More than that – it’s another example of Amazon creating solutions that help to move freight quicker, faster, and more efficiently.