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Amazon to allow entrepreneurs to run their own fleet of delivery trucks under Project Armada

Amazon wants to take the figure to 1,200 vehicles in a year and aims to make the programme contribute 20% of Amazon's total deliveries by the second year.

twitter-logo BusinessToday.In   New Delhi     Last Updated: October 8, 2018  | 13:47 IST
Amazon to allow entrepreneurs to run their own fleet of delivery trucks under Project Armada
PC: Reuters

Amazon is bringing its Armada programme that allows entrepreneurs to operate their own fleet of delivery trucks to India. The programme was announced in the US earlier and the pilot has started in Delhi. In US, the company had announced that they would provide vehicles with the Amazon logo at a discounted lease as well as fuel, insurance and other benefits under the Armada programme. A trader could make around $300,000 a year by running 40 such trucks for the company.

Under the programme, aptly named Project Armada, which refers to a fleet of warships in Spanish, the company has partnered with some logistics companies in India, as mentioned in a report in The Economic Times. These companies will lease out and supply these vehicles to traders. As per the daily, one company has already leased hundreds of vehicle to entrepreneurs.

A source told the daily that Amazon wants to take the figure to 1,200 vehicles in a year and aims to make the programme contribute 20% of Amazon's total deliveries by the second year. Amazon aims to have a dedicated delivery channel and also boost delivery capacity as it looks to expand massively to tier 2 cities and beyond.

While Amazon did not specifically comment on Armada's launch in India, a company spokesperson said, "We cannot speculate on our future roadmap but what we can say is that Amazon continues to invest in its transportation infrastructure and other innovative ways to expand its supply chain capacity and speed up deliveries for customers."

Not only expansion of delivery, this programme will also help Amazon cut transport costs. It, however, means that the company will also have to depend on third party logistic partners. In its regulatory filings in the US, the company mentioned that there was risk involved with being associated with external shipping partners such as FedEx if Amazon is unable to negotiate terms with these transport players.

In India, Amazon has already been pushing its alternate delivery channel. Multiple businesses serve as the last-mile delivery centres. According to the daily, Amazon has increased its last-mile service partner network to 700 stations across 500 cities and towns. Amazon's kirana store programme has also expanded to 20,000 outlets across 350 cities.

(Edited by Anwesha Madhukalya)

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