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Amazon has reached an agreement with Purchase, New York-based Atlas Air Worldwide Holdings to wet lease 20 Boeing 767-300 converted freighters, the second freighter lease deal the Seattle-based online retail giant has signed this year.
Under the agreement, Atlas Air Worldwide subsidiary Atlas Air will operate 20 767-300Fs on a crew, maintenance and insurance contract with Amazon for an initial term of seven years. Operations are slated to start in the second half of this year and get up to full service in 2018.
In addition, Atlas Air Worldwide has granted Amazon warrants to acquire up to 20% of the air cargo operator’s common shares at a price of $37.50 per share over a period of five years, plus an option to acquire an additional 10% over a period of seven years, meaning Amazon could ultimately own as much as 30% of Atlas Air Worldwide.
Amazon SVP-worldwide operations Dave Clark said the Atlas Air-operated 767Fs will support package delivery to Amazon customers “who love ultra-fast delivery, great prices and vast selection.”
Amazon’s deal with Atlas Air Worldwide comes less than two months after Amazon struck a similar wet lease agreement with Wilmington, Ohio-based Air Transport Services Group, which will also operate 20 767Fs on behalf of Amazon.
FedEx Corp. EVP-market development and corporate communications Mike Glenn recently rejected speculation that Amazon is attempting to build its own air cargo network to compete with FedEx and United Parcel Service (UPS). “The reality is it will be a daunting task requiring tens of billions of dollars in capital and years to build sufficient scale and density to replicate existing networks like FedEx,” Glenn said.