Coverage: Pilot strike could hurt Amazon during holiday sales

A pilot strike for a regional carrier that delivers packages for Amazon.com Inc. — as well as DHL — could hurt the online retailer during the all-important holiday shopping season.

Jefferson Graham of USA Today had the news:

ABX Air, a unit of Air Transport Services Group, said it would try to end the strike by seeking a court order and get the roughly 250 pilots back on the job.

ABX Air operates 45 daily flights for DHL and 35 for Amazon. All were canceled Tuesday.

Because pilots won’t cross picket lines, planes can not leave the Amazon hub in Wilmington, Ohio, (southeast of Dayton,) or the DHL hub in Cincinnati, according to the Wall Street Journal.

Amazon, which dominates e-commerce sales, has a big presence in Ohio, where it’s building three data centers and two warehouses, according to the Columbus Dispatch. The newspaper says Amazon will invest $1 billion in the state.

Paul Page and Laura Stevens of The Wall Street Journal said impact to Amazon would be minimal:

Amazon will see a limited impact, since it has only a few flights operating at this point and not all of them will be going through Ohio, the person said. Still, the action will throw off both DHL and Amazon’s networks as they head into the all-important holiday season.

DHL said some “inbound deliveries to portions of the Americas will be delayed today” due to the work stoppage. Amazon said it works with a variety of carriers and is “confident in our ability to serve customers.”

Air Transport Services Group said it is trying to end what it calls an illegal work stoppage. ABX Air President John Starkovich said the airline is seeking a court order to force the pilots back to work.

“We expect the court will uphold our position that the actions taken by the union to refuse work assignments” aren’t legal, Mr. Starkovich said.

Airlines and railroads fall under the U.S. Railway Labor Act, which makes it more difficult to strike. Under that law, contracts don’t expire, and federal mediation is mandated if the two sides can’t come to an agreement. The mediators also can call for a recess in negotiations if the two sides reach a stalemate.

Spencer Soper and Mary Schlangenstein of Bloomberg News note that the strike affects 35 Amazon flights per day:

About 250 pilots employed by ABX Air, a subsidiary of Air Transport Services Group Inc., are striking to protest alleged staffing shortages at the cargo carrier. ABX Air operates 35 flights a day for Amazon and 45 daily flights for DHL, according to the Airline Professionals Association, Teamsters Local 1224, which represents the pilots. ABX said in its complaint that 26 flights, loaded with 1.25 million pounds of cargo, were grounded Tuesday.

The retail industry is gearing up for its busiest period, with shoppers increasingly shunning brick-and-mortar stores and shopping from their phones and computers. Online spending in November and December will increase 11 percent this year to $91.6 billion, according to an October forecast from Adobe Systems Inc.

“While they go through this court process, planes are not flying,” said Satish Jindel, president of SJ Consulting Group. “Obviously that is of concern to a company like DHL and Amazon.” But he said Amazon can shift some volume to United Parcel Service Inc. and FedEx Corp. and can also find some smaller contract parcel shippers to move packages if needed.

The pilots are picketing outside ABX Air’s headquarters in Wilmington, Ohio, and DHL’s North American hub at Cincinnati/Northern Kentucky International Airport.