Logistics, Warehousing & Distribution

Report Says Amazon to Launch Program for Startup Trucking Companies

15 Feb, 2021

Amazon.com Inc. plans to launch a program to recruit hundreds of people to start their own trucking companies and haul goods exclusively for Amazon, according to a report in an IT publication recently.
Brittain Ladd, an e-commerce consultant who was an executive at Amazon, said recently that he became aware of the initiative last year and that it will be “fully operational” by the end of the second quarter, reports the online publication Freight Waves.
Citing an internal Amazon document, The Information reported that Amazon will create an “incubator” to provide business training and loans for entrepreneurs to start their own trucking companies. Ladd said the idea was planted in mid-2018 when Amazon began recruiting Delivery Service Providers (DSP), independent intermediaries who would recruit workers to drive mostly for Amazon. 
The DSP program’s goal was to funnel local delivery operations through individual contractors who each controlled dozens of drivers, Freight Waves reports. The hope was that the contractors would be motivated by big earnings potential to hire thousands of drivers across the country to augment Amazon’s in-house fleet operations.
Since that time, however, Amazon’s delivery volumes have skyrocketed, and it handles about two-thirds of its deliveries in-house, a much higher percentage than three years ago. With e-commerce demand continuing to grow, and more drivers retiring, Amazon is on the horns of a dilemma whether it contracts out the haulage or handles shipments itself. “I don’t believe Amazon will be able to generate anywhere near the needed trucking capacity” to keep up with increases in traffic,  said Ladd.