Amazon buys Boeing jets from Delta and WestJet as plane prices drop

Amazon said on Tuesday it was buying 11 used Boeing 767-300s from Delta and WestJet, the latest sign of freight carrier growth as passenger airlines rush to downsize fleets as Covid-19 overnight at the request of trips.

The expansion comes as Amazon continues to push for faster delivery amid a surge in online orders fueled by a pandemic. Shoppers stranded at home turned to service for essentials and non-essentials, as the holiday shopping season generated additional demand for prompt delivery.

All four WestJet planes are in the process of being converted to cargo jets and will join Amazon Air’s fleet this year, while the seven Delta planes will be added in 2022 after their conversion, Amazon said.

The company has steadily grown its fleet of aircraft dedicated to its Amazon Air cargo operations through lease agreements, but Tuesday’s announcement marks its first-ever aircraft purchase outright, Amazon said.

“Having a mix of leased and owned aircraft in our growing fleet allows us to better manage our operations, which in turn helps us keep pace with our customer’s promises,” said Sarah Rhoads, vice president from Amazon Global Air. in a report.

Amazon has said Amazon Air’s fleet will number more than 85 aircraft, both leased and owned, by the end of 2022. Amazon launched its airline fleet in 2016, suggesting it will cut back its dependence on UPS and FedEx. The company still relies on outside carriers for part of its deliveries, but it quickly ramped up its internal logistics operations, especially during the pandemic. The Amazon Air fleet is operated by Atlas Air Worldwide Holdings and Air Transport Services Group.

The expansion builds on Amazon’s ramp-up of its air cargo fleet last year. The company’s $ 1.5 billion Kentucky aerial platform is slated to open this year. It has a capacity of 100 Amazon-branded aircraft and is expected to handle around 200 flights per day.

Amazon, Delta and WestJet have refused to disclose the price of the planes, but the value of many planes has plummeted this year as the coronavirus decimates travel demand. Values ​​of the Boeing 767-300ERs in mid-December were about 15% lower than in early 2020, according to Ascend by Cirium, an aviation consulting firm. Rob Morris, a consultant at Ascend, said the Delta planes are around 20 years old and if they were between major maintenance cycles they would be valued at nearly $ 13 million to almost $ 14 million each.

Delta and other airlines have accelerated aircraft withdrawals to help cut costs, as the virus and a network of travel restrictions and quarantine requirements aimed at slowing the spread of the disease have held back many customers potentials in them.

Delta announced in June its intention to withdraw seven of its Boeing 767-300ERs by the end of 2020 and in October, it announced its intention to withdraw the remaining 49 of its 767-300ERs by the end of 2025.