Amazon $AMZN may want fewer humans in its vast shipping network, but that’s tough to do when you have planes to fly.
Pilots for Amazon’s new cargo air service are planning to picket outside the retail giant’s annual meeting in Seattle May 23, demanding higher pay. The pilots’ union says low wages are hurting the ability of Amazon’s shipping contractors to keep pilots on board; many are quitting to join other, better paying airlines, leaving the remaining pilots with too much work, the union said.
To get better control over its shipping network and speed up deliveries, Amazon launched Prime Air last year and announced it would lease planes from two cargo airlines. Amazon is also building a $1.5 billion air terminal at the Cincinnati/Northern Kentucky International Airport, where it can fly out goods from nearby warehouses.
Having a dedicated airline may be creating more problems than it solves. Late last year, pilots for one of the airlines Amazon contracted, ABX Air, walked off the job during the busy end-of-year holiday season, contending that they were forced to fly on what should have been days off. Amazon said its shippers have to adhere to its code of conduct, which includes “appropriate working hours,” and overall it is “pleased” with its contractors’ performance.
An impending shortage of pilots is already developing, thanks to a wave of upcoming retirements and fewer young people deciding on the profession. The high cost of schooling and low starting salaries are a deterrent to many who once dreamed of becoming a pilot.
All of this could spell higher shipping costs down the road, bad news in the cutthroat world of e-commerce, which Amazon is trying to make even more affordable for consumers.
Unless its leadership runs with a crazy idea, Amazon isn’t planning to create a passenger airline. But labor strife still ultimately affects customers.
No wonder Amazon is testing delivery drones.
