Amazon Merges Air, Ground Under One Middle-Mile Leader

Amazon has folded its air network, surface transportation and sortation operations back into a single reporting line, handing Raoul Sreenivasan, vice president of Amazon Transportation Services, control of the full middle mile. The change took effect Monday and was announced by Sreenivasan on LinkedIn the week prior.

The middle mile is the stretch between the fulfillment center and the delivery station — the part of Amazon's network that moves freight, not parcels to doorsteps. Until this month, the air piece and the ground piece reported separately.

Sreenivasan framed the consolidation as an operating-tempo play, writing that bringing the teams together means "faster decisions, sharper planning" and a smoother path for every package.

The scope of the job

Sreenivasan moved to Amazon Transportation Services in August after nearly three years running Amazon Global Air. His expanded remit covers the global aviation network, North American surface transportation and trucking, and sortation center operations, with P&L responsibility across all three, according to STAT Times.

The air side alone is substantial. STAT Times put his prior operation at more than 110 aircraft, over 70 on-airport facilities and roughly 14,000 employees globally. FlightGlobal, which reported Amazon Air's 2026 Airline Strategy Award for air-cargo leadership, described a network running around 250 flights a day — flown entirely by contracted carriers, with Amazon owning or leasing the airframes and outsourcing crews and maintenance.

The move has a counterpart that has drawn less attention. Joanne Rzeppa, previously head of North America ATS operations, has taken over Amazon Logistics, the last-mile network. Amazon has effectively drawn a clean line through its delivery chain: one executive owns everything up to the delivery station, another owns everything after it.

Amazon told Supply Chain Dive that the two organizations had been combined before, but declined to say when, or why they were separated. The company also said package flow itself is not changing.

Why now

Two pressures sit behind the timing.

The first is cost. Amazon is absorbing higher transportation expense tied to fuel while compressing delivery windows. On the company's July 30 earnings call, CFO Brian Olsavsky described second-quarter fulfillment gains in terms of inventory placement, shorter shipping distances, fewer touches per package and improved consolidation rates. Every one of those is a middle-mile lever, and every one is easier to pull when a single organization owns the aircraft, the trucks and the sorts.

The second is that Amazon Air is no longer a purely internal utility. Amazon Air Cargo, launched in late 2024, sells lift to third-party freight forwarders and shippers. In early August the carrier put Odyssey — its first factory-built Boeing 767-300F — into service in dedicated Amazon Air Cargo livery. It is one of three new-build 767 freighters, alongside Zenith in Amazon Supply Chain Services colors and Soar in legacy Prime Air branding. These are the first Boeing-produced freighters Amazon has taken rather than converted passenger airframes, and the liveries are not incidental: they map to three distinct commercial propositions.

What it means for forwarders

Here is the part worth watching.

Amazon Air Cargo competes for the same charter and blocked-space business forwarders buy from every other carrier. Its structural constraint has always been internal demand — external capacity is available only when Amazon's own network does not need it.

That allocation decision now sits with the executive who also owns the trucks and the sort centers, and who carries the P&L for all of it. Better visibility across the middle mile should, in principle, let Amazon forecast its own lift requirement more precisely and release surplus earlier and with more confidence. It could just as easily cut the other way: tighter internal utilization, less spillover to sell.

Three things worth tracking over the next two quarters if you hold or are considering Amazon Air Cargo capacity:

• Whether external capacity offers become more consistent or less
• Whether Amazon extends the third-party service guarantees it introduced to address concerns that its own freight gets priority
• Whether the three new-build 767Fs signal owned-fleet growth, which would raise the surplus available to sell

Amazon has said it intends to develop the third-party business further. The org chart just put that decision and the internal network decision in the same pair of hands.