News / Using Amazon Air services 'a win-win' for 'absolutely satisfied' K+N

Photo: K+N

Amazon Air has received a ringing endorsement for its airfreight services from Kuehne + Nagel (K+N), after it opened its capacity to third parties. 

In the Swiss forwarder’s Q3 earnings call yesterday, CEO Stefan Paul revealed that K+N’s Asian subsidiary, Apex, which focuses on the transpacific and intra-Asia with an emphasis on ecommerce fulfilment, is using Amazon aircraft. 

“I have to say we are absolutely satisfied with the service offered by Amazon Air,” he told analysts. “It’s the domestic fleet of Amazon, roughly 60, 70 aircraft.” 

He explained: “We inject in Honolulu our ecommerce business into the Amazon aircraft or air fleet business, and we leverage them for distribution within the US marketplace.  

“It is used for ecommerce, but also for standard hard cargo from the Apex perspective. So this is a perfect fit.  

“On one side, we utilise the return flights for Amazon out of Honolulu, and on the other side, we have a direct connection into the different hubs of Amazon Air in the US marketplace.  

“Overall, I would call it a win-win situation.” 

Amazon is currently fielding four A330-300Fs operated by Hawaiian Airlines out of Honolulu into the US mainland. It has another four stored and two parked, according to Planespotters’ database, all under the Hawaiian contract. 

Amazon announced this month that it was making space available on its flights to third parties, and would offer charters. 

It said: “Amazon Air Cargo is now open for business serving domestic networks across North America, EMEA and Asia. We’re ready to handle, transport and deliver your goods safely, securely and efficiently – on time, every day.” 

Within its three regional air transport networks, Amazon offers one-day services, utilising the amalgamated fleets of its air carrier partners of more than 100 aircraft on more than 250 flights a day. 

K+N meanwhile, in its Q3 results, said it had seen air volume growth up 5% in the quarter, mainly from perishables, with yields and unit costs “stable”, and growth centred on the transpacific. 

One analyst on the earnings call noted that the overall air freight industry had seen double-digit growth this year, and queried why K+N’s was lower. 

Mr Paul explained: “I think the difference comes overall from the ecommerce share, which is, as we all know, outside of our remit, at least in the Kuehne + Nagel legacy; we only provide service for ecommerce companies out of China with Apex. So that’s the reason why our numbers and [the] market rate is a little bit different.” 

K+N’s Q3 air logistics results yesterday showed turnover in the nine months rose 4%, to CHF5.2bn ($6bn), while gross profit sank 7%, to CHF1.25bn. Ebit fell 23% to CHF330m. Q3 fared better, with turnover up 20%, to CHF1.8bn, gross profit up 6%, to CHF434m – but ebit fell 12%, to CHF120m. 

Atlas Air operates two 747-8Fs on behalf of the forwarder.