Amazon enters the race with self-driving cars and may directly compete with automotive makers as they improve their stock price. Just last month, Amazon’s stocks rose, reaching a record high. They continue to strengthen their presence through the development of vehicles under their company itself.
Forbes reported that the company plans to improve its stock price and strengthen market penetration by emerging in the transportation field. This will put them in direct competition with carmakers and package delivery firms.
In the developing story, they stated that in order to achieve, Amazon must create its own logistics ecosystem. They plan to do so by investing in electric and autonomous vehicle startups. This will lower their shipping costs that their partner UPS is predicted to become its competitor.
The pandemic caused car companies to have financial difficulties. Amazon, on the other hand, grew and is at a place where it can pick up these struggling firms that show EV and AV potential.
The report stated that Amazon is in motion as they initiated talks with self-driving tech startup Zoox, despite their recent settlement on a trade secret theft case with Tesla. Despite some of their plans being halted, there are other companies they plan to invest in. These companies include Aurora Innovation, an automated driving startup, and Rivia, an American producer of electric trucks with their headquarters located in Michigan.
Rivian received investments amounting to more than $2.8 billion from Amazon, Ford and Cox Automotive. Their previous plan to launch the RT1, their first truck, has been halted.
Some of the companies Amazon will be directly in competition with include Tesla and GM. UPS and FedEx will need to acclimate if they plan to compete. AV expert Morgan Stanley predicted that the company would save up to $20 billion per year on shipping costs if their plans succeed.
Amazon Prime Air, their drone delivery service, is under development. Amazon Prime Air is its service that will deliver packages to customers within 30 minutes of ordering through air transportation. As of now, Amazon has more than 210 transportation-related patents.