Amazon to spend $1.49B on new air cargo hub

The investment, which could create over 2,000 new jobs, points to Amazon's continued ambitions to expand in shipping and logistics.

Amazon

Amazon is making a major investment to boost its air delivery capabilities.

The world's largest e-retailer plans to spend $1.49 billion to create its first worldwide air cargo hub at the Cincinnati/Northern Kentucky Airport in Hebron, Kentucky, the company and state officials said Tuesday. The new hub is slated to create up to 2,700 new full- and part-time jobs.

The project, spanning up to 900 acres around the airport, would be the largest-ever single investment by any company in Northern Kentucky, Cincinnati.com reported.

"It will change the entire shipping and fulfillment industry," Jack Mazurak, communications director for the Kentucky Cabinet for Economic Development, said in an interview.

Last year, Amazon partnered with two carriers to lease 40 Prime Air cargo planes to ship its packages around the country. Today, 16 of those Prime Air planes are in service, with more coming online over time. The new air cargo hub will support this new fleet by loading, unloading and sorting packages.

The new hub shows just how big Amazon's ambitions are to grow its logistics and shipping, in hopes of keeping up with the growing mountains of packages it has to deliver and, perhaps, someday competing with UPS and FedEx as a shipping company. For now, though, Amazon has continued to say it values its partnerships with its shipping partners and sees its expanding shipping infrastructure as a way of supplementing UPS, FedEx and the US Post Office.

State officials on Tuesday granted preliminary approval on an incentives package of up to $40 million over 10 years for the new project. The hub should start construction this year and take five to seven years to complete, the Northern Kentucky Tribune said. Kentucky's Mazurak said that the full incentive amount will be given to Amazon only if it meets specific investment, job creation and wage targets.

The new hub adds to Amazon's employment in the state, which already includes over 10,000 full-time workers in 11 fulfillment centers. The announcement also keeps up Amazon's plans to hire many more workers in the US. This month, the e-retailer said it will hire 100,000 more US workers over the next 18 months.

Along with the new air cargo hub, Amazon has bought 4,000 truck trailers to boost its trucking capacity. The company's worldwide shipping and logistics network includes 149 fulfillment centers and 20 sorting centers.

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