Skip to content ‘insourcing’ potentially a blow to freight industry ‘insourcing’ potentially a blow to freight industry

AmazonPrimeNow Inc.’s role in the shuttering of New England Motor Freight and the “body blow” dealt to XPO Logistics Inc. is raising alarms for trucking and logistics firms that do business with, or compete against, the popular online retailer.

Bradley Jacobs, CEO of XPO, disclosed that the company’s largest customer — identified by industry analysts as Amazon — was curtailing two-thirds of its business with XPO, resulting in a loss of US$600m in revenue in the coming year.

No one from Amazon or XPO would confirm the identity of the customer. But transportation and logistics industry experts said the type of business and volume affected could only have come from Amazon. For most observers, the decision to terminate that much business simply confirms the long-held expectation that Amazon is ready to go head-to-head with for-hire freight carriers and third-party logistics companies and to handle more of its shipping needs in house.