Reshape Recap: Sustainable Road Trip – Transport Logistics Past, Present, and Future

At the inaugural Amazon Business Reshape event, Steve Armato, VP for Amazon Transportation Services (ATS), took the stage to review the history of Amazon transportation, discuss ATS scale and technology, and preview innovations in technology, safety, and sustainability.

During Sustainable Road Trip: Transport Logistics Past, Present, and Future, Steve explained that up until 2012, Amazon had no internal transportation capabilities. “Carriers just couldn't keep up with our customers' delivery expectations. We also knew we needed to have a better end-to-end visibility and control over the package journey the entire way to the customer's doorsteps."

This realization led Amazon to launch ATS in 2012. To better understand Amazon’s approach to building and expanding capabilities, Steve outlined the structure of the Amazon transportation network, which is divided into three components: First, Middle, and Last Mile. Amazon focused heavily on the Middle and Last Mile components.

• Amazon expanded middle-mile capabilities by building sort centers and including air, intermodal, and line haul transportation. Steve explained, “One of the first customer-facing benefits of this was Sunday delivery, which we launched in partnership with the Postal Service. I bet you guys take that for granted today, but 10 years ago, that was a pretty big deal.”
• Building last-mile capabilities came in the form of a wide network of lockers, hubs, access points, and van fleet that allow secure package pickup and convenient customer returns. This foundational work has enabled Amazon to support heavy bulky deliveries, locker pickups, ultra-fast grocery delivery, Sub Same Day, and more.

Implementing all these improvements has led to impressive results. Steve noted that 1.3 million jobs have been created in local communities, there are 922 million available items that can be fulfilled by the Amazon network, and there are 200 million Prime members benefiting from faster delivery.

Today, ATS represents the central piece of an extensive transportation network that moves billions of packages into and out of hundreds of buildings via many modes of transport. Steve mentioned, “Behind the scenes, we've got some pretty cool stats, too: two-hundred plus buildings, one hundred aircraft, sixty thousand trainers, and hundreds of thousands of active drivers and transportation associates. What orchestrates all that? Technology.” This technology allows Amazon to be:

• Elastic, to rapidly scale ATS capacity up and down
• Precise, with visibility into the current location and history of tens of thousands of assets
• And agile, with the ability to update our plans and routes throughout each day

After discussing the development and scale of ATS, Steve revealed how Amazon’s delivery network is making strides in safety and sustainability. “Safety is integral to everything we do at Amazon — every day, in every operation, and across every country."

ATS has invested more than $280 million in enhancing vehicle fleet technology which to the last-mile fleet as well and include collision warning, automatic braking, maximum speed limiters, and others. This technology has improved the safe operation of delivery, reduced at-risk driving behaviors, and ensured vehicles are in the best shape possible before leaving the yard. Other impacts include:

• 75% reduction in distracted driving rates
• 77% reduction in stop sign and red-light violations
• ~50% reduction in accidents

“I know sustainability is top of mind for many of us. Sustainability is also a core priority in Amazon and there's no established playbook for this. Again, this is where we're going to embrace technology to make progress.”

Amazon co-founded The Climate Pledge in 2019 and has a commitment to achieve net zero carbon emission by 2040, 10 years ahead of the Paris Agreement. Additionally, Amazon also announced a goal achieve net zero carbon emissions on 50% of shipments to be net zero carbon by 2030. Steve shares a few ways that Amazon is tackling these goals:

• Routing algorithms: Best-in-class routing algorithms reduce cost and carbon emissions.
• Renewable natural gas: Fueling trucks with gas captured from landfills, wastewater treatment facilities, and from waste generated at dairy farms.
• Electric delivery vehicles: Amazon ordered 100,000 custom electric delivery vehicles from Rivian, the largest order ever of electric delivery vehicles.
• Sustainable aviation fuel: To reduce the carbon emissions of air transport, Amazon is investing in sustainable aviation fuels, which are derived from renewable resources and generate fewer carbon emissions than standard aviation fuel. Over the last two years, Amazon has purchased approximately 11 million gallons of sustainable aviation fuel.

The work being done is already exciting, but Steve took the final minutes of his presentation to discuss some of the future technology ATS is looking to infuse in Amazon’s delivery network:

• Prime Air: Amazon’s drone delivery service, which will deliver packages weighing 5 pounds or less to customers using an all-electric fleet of drones.
• Amazon Scout: Amazon's fully electric, inherently safe delivery system designed to get packages to customers using autonomous delivery devices the size of a small cooler. They move at a walking pace able navigate around pets, pedestrians, and other objects.
• Investing in emerging solutions: Amazon is investing in BETA, an aerospace startup based in Vermont. The ALIA, BETA's electric aircraft, can perform vertical takeoff and landing while carrying three cargo pallets with zero operational emissions.