Amazon’s plans to significantly expand its presence in the New York area were abandoned for the second time after a group of workers and communities were mobilized in opposition.
In 2019, Amazon suddenly canceled plans to build a second headquarters in New York City after facing a barrage of unexpected criticism. This time, the e-commerce giant was unable to complete the transaction for the cargo hub at Newark Liberty International Airport.
The project, conditioned on hundreds of millions of dollars worth of 20-year debt, has been opposed after being disclosed by the Port Authority last summer.
Huntley Lawrence, Chief Operating Officer of the Port Authority, said in a statement Thursday, “Unfortunately, the Port Authority and Amazon have not been able to reach an agreement on final rental terms, and further negotiations have unresolved issues. We mutually concluded that it would not be resolved. “
Relevant advocacy groups and unions have stated that Amazon will not be able to support leasing unless it makes a series of concessions, including collective bargaining agreements and zero-emission benchmarks at facilities.
“This victory shows that if Amazon wants to continue to grow in New Jersey, it must do so on our terms,” said Make the Road New Jersey, an advocate who questioned the deal. Director Sara Cullinane said.
Amazon expressed confidence in closing the deal in May and expressed disappointment in a statement, saying, “We are proud of our solid presence in New Jersey and look forward to continued investment in the state. I’m doing it. “
Amazon estimated that the project would create more than 1,000 jobs, but if the Port Authority grants a lease to another company, many of those jobs could still be created. Two other companies have bid on this project.
“Growth of air cargo and redevelopment of airport facilities in a way that benefits the community and the community remains a top priority of the Port Authority,” Lawrence, chief executive officer, said in a statement. ..
Larger long-term implications could affect Amazon’s ability to deliver packages efficiently in the northeast. Airport hub Near Allentown, Pennsylvania. Hartford, Connecticut; and Baltimore. “Newark was a natural choice,” said Marc Wulfraat, an industry consultant who closely tracks Amazon’s facilities. “It’s right next to New York City.”
Wulfraat said Amazon can look for other commercial airports in the region to support the increase in package volume, even if the location isn’t ideal.
Partly because of the company’s excellence in the state, it was the opposition to the project. A report produced by a group trying to stop it shows that the number of Amazon facilities in New Jersey increased from one to 49 between 2013 and 2020, nearly triple the number of state warehouse workers. Pointed out. Over the same period, average wages for these workers fell from more than $ 53,000 a year to about $ 44,000 a year, adjusting for inflation, according to Labor Ministry data.
New jersey More states Amazon opposes union activity at the facility, but domestically.
Amazon said the average starting salary for hourly workers was over $ 18 nationwide.The median hourly wage in New Jersey is About $ 23 last year. The company also cited benefits such as full health insurance as soon as full-time employees start working. A 401 (k) plan with a 50% match for the company. Up to 20 weeks of paid parental leave.
Port Authority reveals proposed lease with Amazon In August, The date the board voted to approve the transaction. Authorities said the lease is expected to come into effect around November 1, according to the minutes of the meeting.
Kim Gaddy, Managing Director of the Minami Ward Environmental Alliance, which focuses on environmental issues affecting Newark’s population, said:
under Proposed transactionAmazon has tentatively promised to invest $ 125 million in the renovation of two airport buildings and pay the Port Authority more than $ 300 million over 20 years. This includes a prepayment of $ 150 million.
By September, a group led by Cullinane and Gaddy had begun coordinating opposition with other advocacy groups and unions such as Teamsters, Retail, Wholesale and Department Store Union. The group collected thousands of signatures from residents and circulated petitions to stage public events such as rallies and marches.
The project appeared to be stagnant after the November schedule for finalizing the lease passed unannounced.
Governor Phil Murphy’s spokeswoman in late March First praised “The Governor encourages anyone doing business in our state to work with labor partners in good faith,” the contract said in a statement. (The Governor’s Office declined to comment on Thursday.) Other politicians The state seemed skeptical after this year’s Amazon trade union election victory at Staten Island’s warehouse. As a result, Amazon is in conflict.
Amazon has recently opened an air hub to move products through its own logistics network, rather than relying on an external provider. For cheaper and faster delivery, we prefer to fill customer orders with local inventory, but if the product the customer wants is not in a nearby warehouse, we skip the product to meet the shipping promise.
That business expansion was overdriven during a pandemic of e-commerce sales spikes. “We doubled the capacity we built in Amazon’s first 25 years in just 24 months,” CEO Andy Jassy told investors in May.
However, the company admits that it is building, expanding and hiring more than it needs to, and in April recorded its first quarterly loss since 2015. This year, Amazon withdrew from some investments. “We are trying to postpone building activities on properties that don’t yet need capacity, and we plan to expire some leases,” Jassy said.
