As the Company Faces Challenges to its Expanding Logistics and Delivery Business, Pilots Who Fly for Amazon Prime Raise Concerns Directly With Consumers
WILMINGTON, Ohio, July 6, 2017 /PRNewswire-USNewswire/ — Ahead of Amazon’s largest single-day sales event, pilots who fly for Amazon Prime Air are taking their concerns about the future of the delivery service directly to Amazon customers. Pilots from Atlas Air Worldwide Holdings (AAWW) and Air Transport Services Group (ATSG)—which, together, are contracted to fly 40 planes for Amazon Prime Air by 2018 – launched a nationwide advertising campaign detailing the intensifying issues at their airlines and the potential risks for Amazon Prime customers.
The pilots, who work for companies contracted to fly for Amazon’s Prime Air service, say issues simmering beneath the surface at their airlines and across the air cargo industry threaten to undermine the success of Prime and could pose challenges for their ability to deliver for Prime customers.
Raising these concerns directly with customers in the lead up to Prime Day, the pilots are launching an advertising campaign that will target consumers nationwide on Google and Facebook. The ads will link to CanAmazonDeliver.com, an informational website which details the growing issues at the Prime Air carriers that could undermine their ability to get the job done. The site also includes tools for customers to ask Amazon executives to make sure its contracted pilots have a fair contract to strengthen their ability to deliver for Prime customers.
In what industry experts are calling a “slow burning crisis” that has airlines of all sizes and types scrambling to cope, the pilots and experts say a looming pilot shortage not only threatens to disrupt operations at airlines across the country, but poses a significant challenge to the success of Prime Air. The effects of this crisis have already started to have significant ramifications for consumers—most recently, Horizon Air, a subsidiary of Alaska Air Group and a major regional carrier in the Pacific Northwest, was forced to cancel more than 300 flights this summer due to a “severe shortage” of pilots for its Q400 turboprop planes.
At the same time, the realities of the pilot shortage combined with substandard pay and years-long delays in union contract negotiations have also triggered significant problems at the Prime Air airlines. Both AAWW and ATSG are undercutting industry-wide standards in everything from pay and wages to working conditions, eroding pilot morale.
Conditions at Atlas Air, one of the Prime Air carriers and a subsidiary of AAWW, have also created turnover, recruitment, and retention issues that could undermine the airline’s commitments to Amazon. The company’s efforts to hire at least 160 pilots in the first five months of 2017 have come up alarmingly short. Over the same period of time, Atlas has lost 110 pilots, leaving the company only able to fulfill less than a third of its staffing needs.
In May, pilots voiced concerns to Amazon investors about what Quartz described as “bad news in the cutthroat world of e-commerce” at the company’s annual shareholder meeting in Seattle. There, dozens of pilots from each of the Prime Air carriers protested outside of the venue to alert shareholders about the escalating issues at their airlines and how these could spell trouble for Amazon’s growing logistics and delivery business. These challenges were also outlined in a letter to the Amazon Board of Directors from International Brotherhood of Teamsters General Secretary-Treasurer Ken Hall, which called on the company to work with pilots and the union on solutions to these problems.
First rolled out in 2015, Amazon’s “Prime Day” is a one-day exclusive sales event for Prime members. In 2016, the event generated the highest single-day sales figures for the company –surpassing Black Friday and Cyber Monday – with Amazon selling two million toys and 90,000 TVs in a 24-hour period.
In recent years, Amazon has signaled an increased investment in creating and growing its logistics arm. The e-retailer broke out revenues for its logistics operations for the first time in the first quarter of 2017, and earlier this year, the company announced that it will construct a $1.5 billion hub at Cincinnati/Northern Kentucky Airport (CVG) and will partner with German shipping giant Deutsche Post DHL to leverage the shipper’s existing resources at CVG. Amazon has also inked numerous deals to lease freighter aircraft to build out its air cargo fleet and is rumored to be in discussions to purchase as many as 400 new Boeing 767s. The company has also secured warrants to purchase substantial equity in AAWW and ATSG, driving speculation among some analysts that the tech giant may consider acquiring its cargo contractors in the near future.
At the same time, growing issues bubbling beneath the surface at Amazon’s cargo contractors and across the logistics industry threaten to derail the success of Prime Air. Carriers of all types are facing a nationwide pilot shortage that could leave airlines scrambling to replace tens of thousands of pilots expected to retire in the coming years.
Simultaneously, extensive delays in union contract negotiations and years of substandard pay continue to fuel problems at Prime Air’s contractors, including staffing, attrition and recruitment issues at AAWW. In a recent survey of Atlas pilots, 65 percent of surveyed pilots said they were planning to apply to another airline in the coming year. Many are looking to FedEx and UPS, major delivery companies that offer competitive benefit and pay packages, and that Amazon is relying on less and less for its Prime Air business.
Citing contract violations and short-staffing issues, pilots at ATSG’s ABX Air went on strike in 2016 at the start of the busy holiday shipping season, creating what Fox Business called a “rocky start” for Prime Air.
The Airline Professionals Association, Teamsters Local 1224 represents pilots and flight crewmembers from 11 airlines operating across the country.