Amazon hub at Melbourne airport

Melbourne Airport has scored a new tenant, with the e-commerce giant Amazon locating its new distribution hub to Tullamarine.

Online retail giant Amazon is expanding its Flex service of delivery drivers with a new distribution hub at Melbourne Airport.

Melbourne Airport has scored a valuable new tenant, with the e-commerce giant Amazon locating its new distribution hub to Tullamarine.

The facility within the airport’s 600-hectare business park, will serve as a pick-up point for Amazon Flex delivery partners servicing Melbourne’s northern and western suburbs.

The tenancy comes at a challenging time for the airport which has seen passenger numbers dive by as much as 97 per cent in the last two months, due to COVID-19 travel restrictions.

The huge downturn has seen dozens of retailers close their doors and terminal operations consolidated, giving the airport a ghost-town feel.

With aeronautical revenue dwindling, Melbourne Airport’s chief of property, Linc Horton, said it was more crucial than ever for the airport to diversify and grow its property portfolio.

“While the global health crisis has disrupted global supply chains, Melbourne Airport’s location is ideal for companies like Amazon, needing sizeable building requirements and seeking easy access to freeways,” Mr Horton said.

“In Amazon’s case, we were able to marry that connectivity with the sheer space we have available in our business park. So when they called looking for a flexible warehousing option to support this program, we had the ability to cut through a whole lot of procedural red tape and just get a deal done for them.”

Amazon Australia director of operations Craig Fuller said they were pleased to expand their delivery network in Melbourne, and create more “flexible earning opportunities” for people.

The Amazon Flex service uses independent drivers wishing to supplement their income by delivering packages to customers.

“We’ve continued to grow our Amazon Flex delivery service in Melbourne and now have hundreds of delivery partners,” Mr Fuller said.

“They tell us they enjoy the flexibility they have to schedule delivery blocks around their existing commitments.”

He said the Melbourne Airport distribution hub would complement their Amazon Flex facility at Dandenong, in the city’s southeast.

“The Melbourne Airport site is a great location for us, with ample space for our operational requirements, easy access and good connections to the city, which is ideal for our Amazon Flex operations, with delivery partners coming from all over Melbourne,” said Mr Fuller.

Sydney is the only other Australian city with an Amazon Flex service, operating from a distribution hub at Moorebank.

Since launching in Australia in 2017, Amazon has seen its revenue almost double from $292m in 2018 to $562m last year.

The platform’s Australian arm is yet to deliver a profit.