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Amazon Gets Its Own 767 Cargo Plane for Prime Air

By Rich Duprey – Updated Sep 4, 2020 at 10:18AM

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This is the first time the e-commerce giant has registered a craft directly, rather than leasing it.

Amazon (AMZN 3.04%) is taking the first steps to further integrate its Prime Air fleet into its operations by directly acquiring a Boeing 767 cargo plane. While Amazon has 36 other 767s in its fleet, this is the first one that will operate under direct registration to Amazon rather than being leased.

Amazon Prime Air plane being loaded with cargo

Image source: Amazon.com.

The aircraft industry site PaxEx.Aero noticed Amazon Services LLC was issued the registration N503AZ for the 767-338 on Aug. 31, joining a fleet of over 80 aircraft.

Previously, Amazon leased most of its cargo aircraft through Air Transport Services Group (ATSG 0.14%), which typically provides the fleet with 767s, and Atlas Air Worldwide Holdings (AAWW -0.10%), which supplies 737s and 767s. Amazon has taken an ownership stake in both companies.

Last year Amazon also leased 15 737s through General Electric's GE Capital Aviation Services (GECAS).

Amazon's new plane is actually an old one. It was first put into service back in 1991 with Qantas Airways (OTC: QABS.Y), and more recently was with WestJet Airlines until being placed into storage in early 2019.

The direct registration comes just as the Federal Aviation Administration granted Amazon a certificate to operate a fleet of Prime Air drones to deliver packages.

The developments stem from the need to quickly deliver more goods to consumers who out of necessity turned to online shopping during the pandemic. The crisis also likely made older aircraft more affordable as the global aviation industry collapsed in the wake of the pandemic. With planes grounded and demand still tepid at best, aircraft in storage are unnecessary.

Amazon has four additional plane registrations reserved with the FAA.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Rich Duprey has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool has a disclosure policy.

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