Amazon grows capacity in Brazil with Azul Cargo

Amazon and Brazil’s largest carrier, Azul Linhas Aereas Brasileira, announced a partnership today to increase package delivery in northern Brazil. Azul will transport packages to Amazon's fulfillment center in Cajamr, allowing Amazon to provide two-day e-commerce service to consumers in Manaus and Belem and three-day delivery to consumers in Macapa. Amazon is looking to capitalize on e-commerce growth in the Brazilian market by delivering in the “shortest time and cost possible,” according to a Nov. 17 release from Azul. The e-commerce giant will invest in its own logistics network, including warehouses, trucks, logistics transport, vans, motorcycles and employees. [caption id="attachment_68629" align="alignright" width="400"] Photo/Azul[/caption] Across Brazil, Amazon has 12 fulfillment centers and 12 delivery stations, and has around 1,400 corporate employees, according to the release. While the company has had a presence in Mexico since 2015, it more recently expanded into Brazil, as reported by Cargo Facts Consulting in its 2022 Global-Ecommerce Logistics Outlook . Azul Cargo already has also partnered with Argentine e-commerce company Mercado Libre , the largest e-commerce provider in Latin America, since 2019. Mercado Libre exclusively uses Azul Cargo for its Brazil deliveries, utilizing belly capacity on Azul’s passenger flights, according to previous Air Cargo World reporting . Azul operations Azul Cargo currently has 300 routes, a fleet of 160 aircraft and 150 destinations in Brazil, according to the release. The carrier saw record results for the second consecutive quarter in Q3, reporting a total revenue of BRL$4.4 billion (US $808 million), doubling its revenue from Q3 2019. This was driven by a strong demand for end-to-end logistics solutions, founder and Chairman David Neeleman said during the company’s Nov. 10 earnings call. Azul’s freighter fleet consists of two 737-400 freighters and converted Class F E195 passenger freighters . The airline has also expressed interest in A321 freighters , as reported by Air Cargo World’s sister publication, Cargo Facts . The airline plans to remove 12 of its passenger E1s from the fleet and replace them with E195-E2s, adding around 50% more cargo capacity per aircraft, Azul Chief Financial Officer Alex Malfitani said during the call. E-commerce in Brazil As Amazon looks to expand its package delivery network in South America, it faces competition from other e-commerce providers. Brazil makes up around 55% of Mercado Libre ’s market. The e-commerce company launched its own aircraft network Meli Air in 2020, flying routes in Brazil and Mexico, and expanded its fleet in 2021, connecting its Sao Paulo hub to Goiania (GYN) and Recife (REC) in northeastern Brazil, according to Cargo Facts Consulting . While e-commerce has boomed in the LATAM region — e-commerce revenue growing 35% year over year in 2021 to $157 billion — , air cargo transport in Latin America requires improved air navigation, traffic handling, airport infrastructure and connectivity, according to Cargo Facts Consulting. Chinese e-commerce providers are also looking to take a slice of the Brazilian e-commerce market, with Alibaba’s Cainiao Network planning to add nine distribution centers and 1,000 smart lockers across the country in the next three years.

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