Tag Archives: Amazon

Analysis: Is the wind in the right direction for Amazon to snap up Atlas Air?

The Loadstar, a much respected and often analytically correct Air Cargo magazine has published an opinion piece on the ongoing drama and negotiations at Atlas Air, Southern Air and ATSG and Amazon.

The peculiar case of Atlas management and its increasingly poor relationship with its pilots is indeed confusing – unless, that is, it turns out to be a strategy that allows its executives to cash in big time via a smart trade sale to a key client, Amazon.

Read the entire article here…

Analysis: Is the wind in the right direction for Amazon to snap up Atlas Air?

A few other things that also point to another future merger or a sale is the curious case of the Southern Air 737 operation and Titan leasing which is owned by Atlas and leases out 737′s to other operators.

It would have seemed to this blogger many years ago that all the fancy charts showed the narrow body freight market was ready to explode and indeed it did. Why wouldnt Titan get a piece of the growth with one of its own subsidiaries, Southern Air?

DamAyH2UQAA2fF8.jpg largeThe 737-800 Passenger to freighter conversions are all spoken for well into the future and have already begun revenue flying. It does not appear at least as of this date in 2018 than any are coming the way of Atlas or Southern Air.

In the USA, the entire country is still served by a mere handful of narrow body cargo operators. Alaska, Kalitta II, Aloha/Northern Air Cargo and Southern Air. Growth is assured to whoever can serve the market. I don’t understand why Atlas and Titan haven’t been more aggressive with the Southern Air 737 operation but a sale to Amazon (or anyone else really) would make sense.

20170325_LDD001_0SOMETHING must be more valuable to Atlas’ executives than actual revenue flying airplanes. In this business, when the executives pass up assured GROWTH, that’s usually a signal that a bankruptcy or a merger or a sale is around the corner.

Since in this case Atlas is very cash rich now, the smart money says it’s another merger or a sale vs. any kind of bankruptcy.

So the Loadstar basically just published what many of us have been observing now for the past 6 months or a year now.

These are still great opportunities out there in Air Cargo for anyone else who can read the ti leaves.

hunter_killerI for one have adjusted my course.

The first airline to deploy pilot-less drones will be Amazon.

Plan accordingly my friends!

/pau for now

 

boeing-737ng-cargo-cutawayThis morning Spectre Air Capital has announced they are ordering 15 conversions from Israeli Aerospace Industries IAI for deliveries beginning in 2017.

Of the 15 airframes, three are confirmed to be going to Air Incheon. The other 12 remain a mystery. Air Cargo News and American Shipper both have reported the same news.

Aircraft leasing giant GECAS has also entered the 737-800 passenger to freighter conversion market with an announcement of their first placement of two 737-800 P2F with Dublin, Ireland based ASL Aviation Group.

I have officially stopped keeping a tally on how many 737-800 freighters are on order now. This must be somewhere near the 50 airplane mark and is estimated to go into the hundreds over the next few years as there really is no other narrow body freighter that will be able to do what the NG Boeing narrow body can.

According to Jordan Jaffe from Spectre;

Spectre’s large B737NG freighter commitment follows its 20-aircraft Boeing 767-300ER programme collaboration earlier this year with aircraft trading partner Jetran, the majority of which will become freighters and be operated in support of e-commerce giants such as Amazon’s Prime Air and China-based Alibaba.

Jordan Jaffe, Spectre’s chief executive and co-founder, said: “Demand for express freighters is at an all-time high, with hundreds more required in the coming years to meet the demand created by rapid growth in e-commerce and expansion of the global middle class.

“The classic freighter feedstock is becoming increasingly scarce and overly expensive for their age. We intend to leverage our ability to purchase in fleet-sized transactions to offer next-generation freighters with attractive economics.”

What he is saying is exactly what this blogger has been saying all along. This airplane will effectively render all other 737 freighters obsolete, not to mention any still operating 727s and even the 757 which are all getting very very old. DC-9/MD8X freighters never really made a big impact. The old Pratt engines are fantastic but the corporate pencil pushers will always prefer the CFMs in the newer Boeing airplanes.

2059300

already obsolete, possible future as an “Aloha Tacos” lunch wagon?

Another big problem for these old airplanes will be the ADS-B requirements which will be mandatory by 2020. I am curious to see who the rest of these unannounced customers will be, or where they will find the pilots to fly all these airplanes.

Much Aloha

Amazon Is Making a Big Play to Bypass UPS and FedEx

Several news sites have ran this story over the past two days. Spencer Soaper from Bloomberg has leaked documents showing Amazon Is Making a Big Play to Bypass UPS and FedEx. The story was also on Bloomberg TV here is a link to the video.

Anyway this news is in dramatic contrast to statements made by Amazon at the end of January saying basically the opposite that Amazon not looking to replace the likes of UPS and FedEx

Okay that was a dramatic contrast to the rumors going around in November and December of 2015 saying things like…

A Secretive Air Cargo Operation is Running in Ohio and Amazon Seeks Cargo Planes for Air Freight Operation and Is Amazon Plotting an Air War on FedEx? It just wouldn’t be a rumor without Amazon talking directly to Boeing which is what the Seattle Times reported here Amazon in talks to lease Boeing jets to launch its own air-cargo business.

We have all seen this before. I have been suspicious for a while that what we are witnessing here is a winner take all game in play here. I have not had any evidence to support my theory and Amazon straight out denied it in their January 29th statement but now here we have some hard evidence. I suspect the actual airlines involved are taking this very seriously.

The Public has a short to medium term amount of time to enjoy dramatically lower air freight costs. (free shipping!!) This might not turn out how anyone thinks. Air wars have a way into turning into scorched earths. Anyway I am watching this intently as I have a direct interest. I hope everyone stays safe and calm as our entire industry may be getting tossed into the fray here soon. For now,

Much Aloha!