Originally Published On EVANNEX.
By Galileo Russell
Amazon is as much a logistics company as it is an online retailer. When you click to order a package, it needs to get from the company’s warehouse to your door.
|A look at the Tesla Semi (Instagram: lonestar_hawaiian)
Contrary to popular belief, this doesn’t happen with magic. Amazon relies on a remarkably complex network of trucks, planes, trains, and boats to get its packages to its customers.
The company’s e-commerce dominance has quickly made it one of the biggest customers for UPS, FedEx, as well as the USPS.
In fact, Amazon’s shipping needs are so vast, that it recently began purchasing planes and tractor-trailers to bolster its logistics capabilities.
With so much experience shipping across a global network, and its strategically located warehouses, Amazon is rumored to be entering the shipping business itself. Earlier this year, the Wall Street Journal reported that Amazon is working on a new service called Shipping With Amazon, which would compete with the likes of FedEx and UPS. It’s slated to roll out in Los Angeles and expand quickly from there.
It’s clear Amazon is going to be in the shipping business for quite some time.
Everybody Else Is Doing It
Nearly all of the USA’s largest shipping and trucking rental companies have placed initial orders for the Tesla Semi.
|A look at some of the bigger names who’ve pre-ordered a fleet of Tesla Semis (Source: Transport Topics)
FedEx, UPS, DHL, and Ryder have all put down reservations and appear to be excited about the opportunity to work with Tesla.
Beyond being a more sustainable trucking alternative to burning diesel, the Tesla Semi could represent significant economic advantages.
DHL, who got to test a prototype, even indicated that the Tesla Semi could save the company “tens of thousands” of dollars. These savings come in the form of cheaper refueling and lower maintenance expenses.
If the unit economics are proven, Tesla may have both the cheapest and greenest solution in the logistics industry.
Where Is Amazon?
With all of its competition piling on the Tesla bandwagon, you have to wonder what Amazon’s next move will be.
|Another look at the Tesla Semi (Instagram: deere_3046r)
Have they secretly placed a reservation for the Tesla Semi? Are they planning on building out their own shipping service with diesel trucks? Would they try to build their own electric truck?
It’s anybody’s guess. Regardless, it seems like a partnership between Amazon and Tesla for a fleet of electric semi trucks is a no brainer.
After all, shopping online isn’t going away and Amazon should be building out its shipping infrastructure with sustainability in mind.
Galileo Russell is a 25-year-old Tesla shareholder based in NYC. He has been blogging about Tesla since 2012, and is the founder of HyperChange TV, a new YouTube channel about tech and finance news for millennials.