Amazon.com Inc. (NASDAQ:AMZN) has announced its intentions to create its first worldwide air cargo hub. The project was announced by the company and Kentucky state officials in a joint statement. According to the Northern Kentucky Economic Development Corp., the project would be the largest-ever single investment by any company in Northern Kentucky.
The project will commence at the Cincinnati/Northern Kentucky Airport in Hebron, Kentucky, spanning up to 900 acres around the airport. The project will include a 3 million-square-foot sorting facility, a 350,000 square-foot loading dock and enough ramp space to house 100 cargo jets. Amazon has not yet set a date for its groundbreaking, but plans to start construction this year. The hub should take five to seven years to complete.
The company plans to spend $1.49 billion to create the air cargo hub. According to the announcement, the hub is expected to create up to 2,700 new jobs, 600 of which will be full-time. The jobs will pay an average hourly wage of $26 with benefits. Amazon already employs over 10,000 full-time workers in 11 fulfillment centers in the state.
State officials granted preliminary approval on an incentives package for the new project of up to $40 million over 10 years. Amazon will only receive the full incentive amount if it meets specific investment, job creation and wage targets. Amazon will receive another $5 million from CVG.
The development of the air cargo hub will boost Amazon’s air delivery capabilities. The new hub will support Amazon’s air cargo carrier Prime Air by loading, unloading and sorting packages. Amazon’s, Amazon Prime Air plans to start operating some flights at CVG in April.
The world’s largest e-retailer is turning its focus to growing its logistics and shipping network, which already includes 149 fulfillment centers and 20 sorting centers. Amazon has bought 4,000 truck trailers to boost its trucking capacity. The company also partnered with two carriers last year to lease 40 planes for shipping its packages around the country. A little less than half of those Prime Air planes are in service today. The company said that more of the planes will be coming online in the coming months.
Kentucky Gov. Matt Bevin played a key role in the deal by meeting with Amazon officials to craft the state incentive package. Bevin has made a pledge to the region to support road and other infrastructure improvements related to the project. Boone County Judge-executive Gary Moore commented, “The governor has been very engaged with this project – as engaged as any governor I’ve ever seen with a project.”
Amazon reportedly began inquiring about building the air cargo hub at CVG about two months ago. The Wilmington Air Park in Ohio was also under consideration for the project. Ohio Speaker of the House Cliff Rosenberger, R-Clarksville, said that he was disappointed that Amazon chose Northern Kentucky over his home region.