WILMINGTON, Ohio -- Amazon Inc. has made it official.
It is launching an air cargo network in Wilmington, Ohio, that will support one- and two-day delivery to its U.S. customers. After months of speculation, Amazon confirmed it is leasing 20 planes and contracting with Air Transport Services Group Inc. to operate the cargo network.
“Since last summer, we have been working closely with Amazon to demonstrate that a dedicated, fully customized air cargo network can be a strong supplement to existing transportation and distribution resources,” ATSG President Joe Hete said in a press release. “We are excited to serve Amazon customers by providing additional air cargo capacity and logistics support to ensure great shipping speeds for customers.”
Amazon is leasing 20 Boeing 767 freighter jets from ATSG for five to seven years in a deal that gives Amazon the right to buy up to 19.9 percent of ATSG stock over five years for $124 million. ATSG shares surged in response to the news, up nearly 19 percent to $14 in mid-day trading.
The deal is seen a huge economic development win for Clinton County, which has been hungry for aviation expansions since 2008, when DHL Express left Wilmington for Northern Kentucky – eliminating 8,000 Ohio jobs and boosting the city’s unemployment rate to 12.8 percent.
A 250-job expansion in an aircraft maintenance hangar in 2014 brought ATSG’s employment to 640.
The company told WCPO last September that about three dozen people were working the air-cargo network, which went by the code name, Project Aerosmith at the time. In the last few months, various media outlets began speculating that Amazon was the company behind the cargo network.
The e-commerce giant has a warehouse in Hebron and has previously announced plans to invest $1 billion in Ohio, including distribution and data centers in Columbus.
“We offer Earth’s largest selection, great prices and ultra-fast delivery promises to a growing group of Prime members and we’re excited to supplement our existing delivery network with a great new provider, ATSG, by adding 20 planes to ensure air cargo capacity to support one and two-day delivery for customers,” said Dave Clark, Amazon senior vice president of worldwide operations and customer service.