Getting under the hood of Amazon’s auto ambitions

DETROIT: Amazon.com Inc. is expanding its transportation prowess to do virtually everything short of building a car.

While Amazon founder and chief executive Jeff Bezos has said little publicly about the company’s ambitions in the sector, the strategy is aimed at leveraging Amazon’s strengths in logistics, cloud computing and digital services together with new interests in related fields from robotics to manufacturing, according to more than two dozen people, including Amazon executives and industry executives familiar with the strategy, and a Reuters analysis of Amazon’s patent activity.

With these new investments and alliances up and down the auto supply chain and by hiring key auto industry veterans and amassing a robust patent portfolio, Amazon is positioning itself to challenge corporate customers and partners ranging from United Parcel Service Inc. to Uber. Businesses such as Amazon Web Services and Fulfillment by Amazon started as internal efforts to cut costs and improve efficiency in serving consumers, and later expanded to corporate customers. However, companies working closely with Amazon also risk losing business to the online retailer as its transportation expertise grows, according to some analysts and industry insiders.

Corporate customers “should be very scared” of Amazon’s move into the dashboard, said John Ellis, a transportation consultant and former global technologist at Ford Motor. As consumers pay less attention to horsepower and more to streaming content and services, he expects more consumers “won’t really care whether you’re in a Ford or a Chrysler or a Chevrolet or a BMW”.

Ned Curic, a former Toyota Motor executive recruited by Amazon to oversee Alexa Auto in 2017, told Reuters that the firm is “always looking for ways to more closely integrate Amazon services if we think it’ll bring value to the customer”. The firm also is rapidly expanding its business with corporate customers, notably through two major cloud-based initiatives this year with Ford and VW.