Atlas Air Ends Cargo Partnership With Amazon to Focus on International Customers Like Shein, Temu

By Thea Felicity

Jun 01, 2024 08:17 AM EDT

Atlas Air Worldwide will stop flying freighter aircraft for Amazon's domestic parcel network by mid-2025.

Yahoo Finance reported that Atlas Air Worldwide CEO Michael Steen told FreightWaves that this is so the company can focus on international widebody service, catering to new clients such as Chinese e-commerce giants Shein and Temu.

US-TRANSPORT-AVIATION-BOEING-747 — Workers gather to watch as the final 747 airplane produced by Boeing, a 747-8 Freighter for Atlas Air, taxis before take off from Paine Field in Everett, Washington on February 1, 2023. - Boeing officially bids farewell to the original jumbo jet, the 747, as it makes its final commercial delivery of an aircraft that democratized flying and serves US presidents.
(Photo : JASON REDMOND/AFP via Getty Images)

Atlas Air and Amazon Agree to Terminate Contracts

Amazon and Atlas Air reportedly both agreed to terminate contracts, which were set to expire in March 2026. Under the agreements, Amazon provides the aircraft, while Atlas Air provides the crews, routine maintenance, and insurance for 17 Boeing 767-300s and eight Boeing 737-800s, all converted to be freighters.

The change in partnership will reportedly allow Amazon to transfer some of the 767 fleet to ABX Air, owned by Air Transport Services Group, under a new five-year contract. However, Amazon representatives have yet to comment on the changes to its air network.

Steen noted that intercontinental operations bring higher profitability, citing strong demand from the e-commerce and fast-fashion sectors. That also aligns with their financial outlook for the next few years.

International Expansion of Atlas Air

To focus on larger aircraft and global markets, the top global provider of outsourced aviation logistics plans to add eight widebody freighters in 2024, including two 777 production freighters and four previously owned Boeing 747-400 cargo jets.

Currently, Atlas Air manages or leases 112 aircraft and aims to reach 120 by the end of the year. The company's focus on long-haul cargo jets is driven by favorable market conditions and anticipated growth in global e-commerce shipments that are expected to capture 41% of the retail market by 2027.

Despite terminating its contracts with Amazon, Steen said Atlas Air will redeploy its resources to support other customers, including the US Department of Defense.

Steen also reassured employees that no pilots would lose their jobs due to a lack of available aircraft or flights, citing that Atlas Air would, instead, grow its pilot roster to support its expanding international operations.