Amazon uses Uber for Singapore deliveries (AMZN)

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August 3, 2017 5:02 PM

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After its much-anticipated launch in Singapore last week, Amazon is seeing skyrocketing orders for its Prime Now two-hour delivery service, prompting the company to hire Uber and taxi drivers to help deliver packages, CNETreports.

Prime Now has been a hit since the launch, with the Prime Now app topping 11,000 downloads in the iOS and Google Play stores from July 27-30. However, the volume of orders quickly overwhelmed the service — Mashablereportedthe Prime Now app showed delivery was unavailable on any items for part of last Thursday and.

Hiring drivers for deliveries could get Amazon in trouble with Singapore’s regulatory authorities, according to CNET. The city-state’s Land Transport Authority told a local newspaper that taxis and for-hire private cars are bound by local regulations to exclusively transport passengers, not goods. However, there is a loophole that allows taxis to transport goods if they are being carried by a passenger.

Amazon previously tested hiring cab drivers to deliver packages in California through the Flywheel mobile app, and Uber also launched UberRush in 2015 to make last-mile deliveries in certain cities. Ride-hailing companies could potentially reduce last-mile delivery times and costs in markets where there is an incredibly high density of drivers to make deliveries. However, they would have to catch up to parcel delivery companies that have spent years optimizing their delivery routes — a complex task for any crowdsourced delivery scheme, a report from UK parcel delivery company ParcelHero noted. Additionally, it remains to be seen how comfortable customers are with Uber or Lyft drivers delivering packages to their doorsteps instead of uniformed delivery workers.

Here are some of the key takeaways from the report:

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