Amazon expands air cargo network with Hawaiian Airlines deal
Amazon acquired the option to buy up to a 15% stake in the parent company of Hawaiian Airlines, as part of a strategic air cargo deal.
Why it matterd: This is about the e-commerce giant seeking to control even more of its own supply chain, while also putting competitive pressure on frenemies FedEx and UPS.
Details: Amazon received warrants to buy up to a 15% stake in the outstanding common shares of Hawaiian Holdings (Nasdaq: HA), exercisable over the next nine years.
- Hawaiian will operate an initial fleet of 10 Airbus A330 freighters for Amazon beginning in fall 2023, and it will also establish a continental U.S. pilot base and make related hires to support its Amazon flights.
The bottom line: "Amazon put together a fleet of leased and purchased aircraft acquired from other companies, typically at a discount to new models rolling off the assembly line. The service, which relies on pilots from a handful of partner carriers, has grown rapidly in recent years, tacking on new airport hubs while leasing and purchasing more aircraft." — Mary Schlangenstein, Bloomberg