Amazon maritime freight forwarding in full swing

Amazon has been in the maritime forwarding business since October 2016, according to an “Ocean Audit” report cited by the Wall Street Journal. While Amazon has not commented, this latest news fleshes out the e-commerce giant’s multimodal logistics strategy, which includes freight forwarding and direct involvement in trucking, airfreight and, now, seafreight.

Starting this month, Amazon began posting rates for new services traditionally handled by global freight companies in China. The services and rates were posted under Beijing Century Joyo Courier Service Co., Amazon’s Chinese subsidiary.

In early 2016, Amazon was granted a license from the U.S. Federal Maritime Commission to operate as a non-vessel operating common carrier (NVOCC) for cargo shipments between China and the United States. In short, Amazon China gained the rights to become a freight forwarder, and the 150 containers shipped so far represent the start.

With maritime forwarding’s reputation as a notoriously complex and time consuming mode of shipping, Amazon’s entry could signal a cheaper, more straightforward option for Chinese shippers. The initial beneficiaries seem to be shippers that sell products through Amazon, but the potential exists for a broader customer base in the future.

Unlike it’s aviation strategy, where Amazon leases 767 freighters that are operated on an ACMI basis by Atlas Air Worldwide and ATSG, it’s maritime model follows a more traditional forwarding model wherein the Seattle-based company books space on ocean vessels and then trucks goods between ports and warehouses.

The October 2016 start date also puts Amazon ahead of its Chinese competitor, Alibaba, which announced a partnership with Maersk Line earlier this month that enables customers to reserve space on Maersk ocean vessels via the internet.

In addition to cutting out freight forwarding middlemen and opening pathways to global markets, the Alibaba move was regarded as a shot in the arm to the struggling maritime business that is floundering in a sea of overcapacity and low shipping rates.

On Dec. 22, 2016, Maersk began offering the maritime service on Alibaba’s OneTouch booking website. OneTouch offers advance booking of cargo space on selected routes from eight Chinese ports, with a pre-paid deposit. OneTouch, which was acquired by Alibaba in 2010, targets small- and medium-sized Chinese exporters and allows them to book airfreight and parcel delivery services.

Those interested in learning more about air freight in 2017, should join us at Cargo Facts Asia in Shanghai, 25 – 26 April.  To register, or for more information, go to CargoFactsAsia.com.