Amazon.com Inc. AMZN is planning to buy used long-range Boeing Co. BA and Airbus SE EADSY cargo planes that can fly directly from China to the U.S., Bloomberg reported Wednesday.
What Happened: Amazon is shopping for refurbished cargo versions of 10 Airbus A330-300 aircraft as well as an unspecified number of 777-300ER aircraft, as per the report that cited people familiar with the matter.
The planes represent a step up from the mid-size Boeing 767 aircraft that have served as the backbone of Amazon’s fleet for five years, the report added.
See Also: Why This Amazon Analyst Is Cautious On E-Commerce Giant For Balance Of 2021
Why It Matters: Amazon’s dedicated air network, Amazon Air, was founded in 2016 as part of the e-commerce giant’s efforts to reduce its dependence on third-party carriers and also deliver products faster to consumers.
The purchase of long-range cargo planes would enable Amazon to fly goods directly from China to the U.S. and help avoid shipment delays at major U.S. ports.
It would also enable the company to compete better with United Parcel Service Inc. UPS and FedEx Corp. FDX.
It was reported in July, citing the Wall Street Journal, that Chinese e-commerce giant Alibaba Group Holding Ltd. BABA is intensifying its rivalry with Amazon by aiming to deliver goods from China to anywhere in the world in 72 hours.
Price Action: Amazon.com shares closed 1.1% higher in Wednesday’s regular trading session at $3284.28 and further rose 0.2% in the after-hours session to $3291.11.
Read Next: Is Amazon A Long-Term Story Facing Short-Term Headwinds?
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