FedEx, UPS Case like Morgan Stanley says they face risk from Amazon Air

It's not just the racing white vans that cut off FedEx and UPS trucks to deliver your Amazon order, it will soon become the mega-online store jet.

It is the word of Morgan Stanley analyst Ravi Shanker who released a note to investors on Tuesday, December 4, about the risk of FedEx Corp. (FDX) and United Parcel Service Inc. (UPS) as Amazon.com Inc.. (AMZN) builds its shipping empire to heaven and beyond.

"We believe the market is missing the risk Amazon Air represents UPS / FDX growth," Shanker wrote in the note that brought turbulence to shipping giant stocks. FedEx was down at almost 7% and UPS tumbled 7.7% on Tuesday.

As Amazon plans to deliver 40 aircraft and build a shipping hub that can handle 1[ads1]00 rays, the dealer will threaten the revenue potential of both FedEx and UPS, said Shanker, and the two could hit a hit of around 2% in "potential revenue loss" in 2018 and be beat by more than 10% by 2025.

Shanker's analysis caused Morgan Stanley to reduce the UPS price to $ 87 from $ 92 and FedEx to $ 230 from $ 240.

Domestic air accounts for almost a fifth of sales to the shipping companies.

In addition, Amazon will probably save more money by building, instead of buying, its air program, announced two years ago, analyst said. By next year, Amazon can save up to $ 2 billion with the jet program.

Amazon shares were down at around 1% on Tuesday.