Amazon & Uber Transforming Logistics
Amazon recently announced that they will launch their shipping service “Shipping with Amazon” in Los Angeles and this new feature will compete with UPS and FedEx. While Amazon previously delivered packages from Amazon warehouses to customers, with SWA they will now pick up packages from business partners and deliver directly. Eventually, they will also deliver for companies that are not connected to their retail platform.
The online retail giant has its reasons to devote resources to develop logistic services: After Christmas, 2013 when UPS couldn’t keep up with the millions of Amazon packages that had to be delivered, it became clear that they have to take the matter into their own hands in order to avoid losing customers.
Amazon is not simply planning to provide logistic services, they are looking for ways to improve shipping practices and increase efficiency. Only in 2017, Amazon added over 55,000 robots to its fleet and continues to utilize its tech knowledge by filing patents for innovative warehousing technology, drone delivery, autonomous trucking etc.
Amazon is not the only tech company, though, that recently gained interest in the logistics industry. Uber, the well-known taxi app is now officially a “peer-to-peer ridesharing, food delivery, and transportation network company”.
UberRUSH, their package delivery service is currently only present in New York, San Francisco, and Chicago. On the other hand, their food delivery service, UberEats is already present in South America, Europe, Australia and Asia.
Not only did Uber enter last mile delivery, in 2016 also they bought the self-driving truck startup, Otto. Since the beginning of March, they are operating an autonomous fleet in Arizona through their UberFreight app which is to match carriers with shippers. These trucks are currently not suitable for dock-to-dock deliveries, they do the highway portion of the shipment.
For Amazon & Uber to be able to really make use of their technical know-how technology still needs to advance and the regulations have to adjust to the new conditions, allowing autonomous vehicles to work fully.
For a summary on which segments of logistics Amazon and Uber are currently active in, take a look at the infographic below. These endeavors just come to show, that the growing need for shipping makes the market attractive even for those who previously weren’t present in the segment. Although UPS, FedEx, and other shipping giants might not be worried at the moment, it is sure that the entrance of these new market players will increase the fierce competition in logistics.