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Amazon's Next Delivery Method Is... Container Ship?

Illustration for article titled Amazons Next Delivery Method Is... Container Ship?

Amazon can send millions of packages every day, but its ability to shift products at volume may soon increase in an unexpected way: It’s getting into the shipping business.

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Flexport writes that the Chinese wing of Amazon has registered itself to operate as an “ocean freight forwarder” in the United States. That will allow it to ship its own goods from China to the shores of the US, along with carrying freight for other companies at the same time.

As The Economist pointed out late last year, the container-shipping market has been in steady decline of recent times. In fact, the cost of shipping a container across the Pacific almost halved in 2015. It’s thought that the market is set to recover, though, so now is a perfect time for Amazon to get involved.

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The ability to ship Chinese goods to its own fulfilment centers would open up the world of cheap new goods even further for Amazon, and allow it to directly fulfil orders for more Asian suppliers—which is often attractive to consumers. But this is only the first step in the process, and it could be years until the first of its ship set sail.

So, like the tortoise and the hare, it’s a race between a drone and a cargo ship. Which will win?

[Flexport]

Image by AP

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DISCUSSION

We’re used to thinking of Amazon as a retailer but in reality it’s a delivery service; it make so few of its own products that it is more like UPS than Wal-mart, making its money on offering a premium delivery service (Prime) rather than on the low margins of books, media or stuff. It’s a digital distributor (Kindle, Amazon Prime video). It’s a digital infrastructure company (AWS), delivering digital services. All of these things are about one-stop convenience, using a single point of contact to deliver stuff in all dimensions; if we take that to its ultimate end, will there be Amazon Air and Amazon Cruise Lines? Amazon Space? Am-azon-trak?