Nowhere is the company’s push to become a logistics and delivery powerhouse more evident than in the nation’s capital. Amazon has emerged as one of the tech industry’s most outspoken players in Washington, spending millions and meeting regularly with lawmakers and regulators.
WASHINGTON — Ever since Jeff Bezos started the website Amazon to sell books, he has wrestled with how to deliver its products as quickly and cheaply as possible. Today, Amazon, now a retailing giant, remains obsessed with this issue, building its own fleet of drones, buying trailers for trucks and signing up drivers for on-demand deliveries.
And nowhere is the company’s push to become a logistics and delivery powerhouse more evident than here in the nation’s capital. Amazon has emerged as one of the tech industry’s most outspoken players in Washington, spending millions on this effort and meeting regularly with lawmakers and regulators.
Amazon has pushed officials to allow new uses for commercial drones, to extend the maximum length of trucks, to improve roads and bridges and to prop up a delivery partner, the U.S. Postal Service.
The efforts are mostly in the early stages, but Amazon already has detractors, particularly for its drone efforts. Some drone makers argue that Amazon is pushing too hard, too fast. And airline and pilot groups have said opening the skies to more drones, which are remote-controlled flying machines, could create safety risks.
“The chances of a collision will go way up when you have more unmanned aircraft up,” said Chris Dancy, a spokesman for the Helicopter Association International, a trade group.
Colin Sebastian, a senior analyst at Robert W. Baird, said, “Amazon is disrupting huge industries; retail was a start, then the enterprise market with its cloud platform and now transportation logistics.” He added, “This is Jeff Bezos’ playbook, and achieving it by influencing legislation would be consistent with that plan.”
The money Amazon spent on lobbying in 2015 nearly doubled, to $9.4 million, compared with the year before, which helped to pay a bigger lobbying staff and pay for a new office to house it. The tally, compiled from public records by the Center for Responsive Politics, includes only the spending that Amazon must legally disclose.
Amazon’s figure still lags those of some companies that made camp in Washington long ago, like Boeing, which spent about $21 million in 2015. And it trails the leading tech lobbyist, Alphabet, Google’s parent, by several million. But Amazon’s spending grew at a faster pace than any other big tech company’s.
When Paul Misener, Amazon’s global head of policy, took over the company’s Washington office 15 years ago, he had a staff of two focused on retailing tax laws and technology-related issues. Amazon now has more than 60 people listed as its lobbyists — double what it had just two years ago, according to the data from the Center for Responsive Politics.
The lineup includes people as prominent as Trent Lott, the former Senate majority leader, who helps persuade members of Congress. Representatives for Amazon have met with lawmakers dozens of times in the last year. Efforts also reached NASA, the postal commission and the Transportation Department, among others.
Amazon and Bezos, its chief executive, have other interests in Washington, too. Amazon is now a major government contractor with a $600 million cloud computing partnership with the CIA. And Bezos’ ownership of The Washington Post, which he bought in 2013, gives him a foothold in the political and media circles of Washington.
Amazon declined requests to comment for this article. But on a recent earnings call, Amazon’s chief financial officer, Brian Olsavsky, explained why Amazon wanted to move more aggressively into delivery.
“To properly serve our customers at peak, we’ve needed to add more of our own logistics to supplement our existing partners,” Olsavsky said. “That’s not meant to replace them.”
In addition, the company’s shipping costs rose 19 percent, to $5 billion, in 2015. The millions of members of its Prime annual subscription service, Amazon’s most frequent customers, have helped feed the surge. These customers often receive free shipping.
Some analysts expect Amazon eventually to take over its entire logistics chain — in some cases, from factory to doorstep. Just this month, Amazon signed a deal to lease 20 Boeing cargo planes.
A few analysts became excited when Amazon referred to itself as a “transportation service provider” in a recent regulatory filing. The company, they suggested, could even become a competitor to UPS and FedEx.
- Seattle’s vanishing black community
- Bellevue School District seeks to fire football coach Goncharoff over scandal
- Boeing tankers will be delivered to Air Force late — and incomplete
- Paul Allen ends KEXP’s yearslong fundraising drive with $500,000 donation
- A six-pack of observations from Seahawks' OTAs: Justin Britt, Alex Collins, Tharold Simon and more
Most Read Stories
Olsavsky insisted on the call that UPS and FedEx would continue to be important partners. FedEx’s chief, Fred Smith, also played down the prospect that Amazon would become a rival. In a call with analysts and investors last week, he criticized “fantastical” reports about Amazon’s challenge to logistics companies.
Satish Jindel, founder of the SJ Consulting Group, which advises transportation and logistics companies, said, “If my package doesn’t get delivered to my expectations, most people don’t think of FedEx or UPS.” He added, “They think of the retailer.”
Already, the company’s drone push in Washington has had some success. Amazon has worked with NASA, for example, to create an air traffic system that would establish lanes in the sky for drones.
Amazon has also urged Congress to adopt rules that would allow the retailer to fly drones beyond a pilot’s line of sight, a major hurdle to Amazon’s goal of operating drones from its warehouses. This month, the Senate Transportation Committee drafted a bill that would ensure rules for delivery drones within two years.
Some drone makers said in interviews that Amazon’s bold statements may be generating too much public angst, helping the safety advocates.
Amazon is arguing for changes in many other areas, too. Already, Misener, the lead lobbyist, has called for an overhaul of an arcane system of international delivery rates that he says gives foreign e-commerce rivals an advantage in delivering to U.S. homes.
He also urged the approval of legislation that aims to improve roads, bridges and railways. The bill was passed by Congress and signed into law in December.
“The private sector cannot make all the necessary improvements” in transportation, Misener said in July during a Senate hearing, a message that he has repeated to members of Congress. “Government needs to keep up.”
Amazon has backed a proposal for 33-foot twin-trailer trucks, vehicles that would extend the current legal length of trucks by several feet; opponents say longer trucks could make roads more dangerous for other drivers.
“The 33-foot trucks are going to be safer,” Misener said in July, “because there will be fewer of them on the road, driving fewer miles.”
The proposal has been met with resistance from Ralph Nader, a longtime consumer advocate. He said he wrote Bezos, asking Amazon to stop its support of these trucks for safety reasons. He said Bezos never responded. The proposal was rejected last year as part of a broader transportation bill.
“Drones and longer trucks, what are all these efforts for?” Nader said in an interview. “To get you your toothpaste faster?”