Amazon to invest $2.1 billion in contract driver program
Amazon is offering funding for a variety of incentives, services and perks for members of its Delivery Service Partners (DSP) program.
Drivers who work with Amazon’s Delivery Service Partners, or DSPs, will earn an average of nearly $22 per hour, a 7% increase from the previous average of $20.50. Launched in 2018, the DSP program provides support to Amazon employees who leave their jobs to build their own contract delivery businesses. Since its initial rollout, Amazon says it has invested $12.3 billion in the program and more than 4,400 participants have created 390,000 driving jobs and generated $58 billion in total revenue for their companies.
Now, Amazon is making an incremental investment of more than $2.1 billion in the DSP program going toward safety programs, rate cards, training, services and incentives. In what it says is an effort to help DSPs provide greater wages and benefits to drivers, Amazon will invest an additional $660 million over the next year in rate card increases and bonuses.
In addition, Amazon is adding a new offering from financial services platform PayActiv that will enable DSP drivers to have access to up to 50% of their accrued wages. The service will also support cash rewards; exclusive discounts on things like movie tickets, prescriptions, and gas; bill payments, and a savings tool, in one app.
Amazon leverages AI to enhance DSP driver experience
Virtually every part of Amazon’s DSP route planning system employs machine learning to use environmental factors like weather, along with models predicting walk distance, to produce routes that are easier for drivers who are delivering during the hot summer months.
In 2023, this allowed Amazon to adjust routes so DSPs could give their drivers additional breaks. The company is also using predictive models that identify potential safety risks on the road and technology to alert drivers to safety cues within the delivery app, such as unpaved roads or railroad crossings.
Amazon has also trained its ML systems based on public safety datasets to help construct safer routes. By end of 2024, the company expects to identify risk characteristics for 200 million roads and provide 18 million safety cues for drivers.
[READ MORE: Amazon reroutes drivers in real time]
Other recent enhancements Amazon has made to the DSP program include leveraging machine learning and delivery history to reduce the number of in-app interactions by 30%. The company is working to reach a 50% reduction by end of year.
Changes that streamline the driver app experience include combining screens, such as delivery photo confirmation and overall delivery confirmation screens.
"I’m truly in awe of the incredible accomplishments of our DSP partners and their drivers, who go the extra mile to deliver smiles to Amazon customers," Beryl Tomay, VP, transportation at Amazon, said in a corporate blog post. "Their success is a testament to the transformative impact that can be achieved when individuals are given opportunities and support."
