Amazon expands air cargo service to India even as company cuts costs

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A wide body aircraft emblazoned with Amazon’s Prime logo lands at Lehigh Valley International Airport in Allentown, Pennsylvania, U.S. December 20, 2016. Picture taken December 20, 2016. To match Insight AMAZON.COM-SHIPPING/ REUTERS/Mark Makela
REUTERS/Mark Makela

Amazon on Monday announced it’s bringing its air cargo operations to India, marking fresh growth for the company’s logistics arm even as it looks to cut costs in other divisions.

The e-retailer is using two Boeing 737-800 aircraft flown by Quikjet Cargo Airlines to ship packages between Hyderabad, Bengaluru, Delhi and Mumbai. Amazon Air will enable the company to offer faster deliveries to customers in India, said Sarah Rhoads, vice president of Amazon Global Air, in a statement.

The launch of Amazon Air in India comes as Amazon CEO Andy Jassy is undergoing a broad review of the company’s expenses as it stares down a worsening economic outlook and slowing retail sales. Last week, Amazon began the latest phase of the largest layoffs in its 28-year history, which are expected to result in 18,000 employees being laid off. Jassy has looked to slash costs in other ways, including instituting a hiring freeze across Amazon’s corporate workforce, axing some projects and pausing warehouse expansion.

Even as he looks to trim expenses, Jassy has previously said the company intends to keep pursuing long-term opportunities and continue to invest in its stores, advertising and cloud-computing businesses, among others.

Amazon Air, which debuted in 2016, outsources operations to several airlines. The service allows Amazon to have greater control over the speed and cost of deliveries, which the company has worked to accelerate from two days to one- and same-day in more parts of the U.S.

Amazon Air launched in the U.S., then expanded to Europe. India is the third market and Amazon Air’s first operation in Asia.

Amazon has for years been working to grow its presence in India, which is poised to become one of the fastest-growing e-commerce markets in the world.

WATCH: How Amazon is shipping for third parties to compete with FedEx and UPS

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