Amazon doesn’t have desire to be long-haul delivery business, analyst says – CNBC
Despite reports that Amazon is laying the groundwork for its own shipping business, at least one Wall Street analyst doesn’t think the e-commerce giant is going in that direction.
Amazon has publicly said it wanted to supplement delivery services like UPS, not destroy them. However, The Wall Street Journal reported that Amazon wants to build a massive delivery network that could eventually compete with UPS and FedEx.
“I don’t think that Amazon, at least at this point, has desires to be a long-haul carrier,” Morningstar senior restaurant and retail analyst RJ Hottovy told CNBC’s “Closing Bell” on Wednesday.
That being said, he thinks reducing the dependence on other delivery services is a smart move.
“In this environment, consumers are looking for that delivery speed almost as much as price and selection in terms of when they make a purchase decision,” he said.
He also thinks Amazon could avoid bottlenecks that have occurred the last few holiday seasons by taking greater control of its deliveries.
Despite his belief that Amazon isn’t interested in going all the way in the delivery business, Hottovy admitted it is possible Amazon could be testing the waters for such a thing. That’s because it has been the company’s modus operandi to slowly try something, see what works and then aggressively jump in, he said.
However, he thinks a big challenge for Amazon would be the ability to pick up packages from consumers.
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