Amazon lays off staff at Prime Air drone project

FILE PHOTO: An Amazon Prime Air Flying Drone is displayed during the 'Drones: Is the Sky the Limit?' exhibition at the Intrepid Sea, Air & Space Museum in New York City, U.S., May 9, 2017. REUTERS/Brendan McDermid

(Reuters) - Inc said on Thursday it had laid off dozens of staff working on the e-commerce giant’s delivery drone project as part of a reorganization of the team.

The U.S. retailer has been working on a plan to deliver goods to millions of its customers by using a fleet of unmanned drones, and had received federal approval in August to begin testing commercial deliveries in the country.

“We are reorganizing one small team within our larger Prime Air organization to allow us to best align with the needs of our customers and the business,” Amazon spokeswoman Kristen Kish said in a statement, without providing a number on how many employees will be sacked.

Kish said the company was working to find roles for the affected employees “in the areas where we are hiring”.

The company had laid off R&D and manufacturing staff from Amazon Prime Air project and had reached tentative deals with two external manufacturers - Austria's FACC Aerospace and Spain's Aernnova Aerospace - to build components for its long-awaited drone, the Financial Times reported earlier in the day.

The full terms of the agreements with the manufacturers were still being finalised, the FT report said, citing a person familiar with Amazon’s plans.

Aernnova and FACC did not respond to a Reuters request for comment.

Reporting by Aishwarya Nair in Bengaluru; additional reporting by Juby Babu; Editing by Sherry Jacob-Phillips