The e-commerce giant said it was laying off dozens of research and development and manufacturing staff working on the delivery drone service, turning instead to two external manufacturers to build components for the drones.
“As part of our regular business operations, 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 spokesperson Kristen Kish said in a statement emailed to TheStreet.com.
"For affected employees, we are working to find roles in the areas where we are hiring that best match their experience and needs,” Kish said.
Amazon said it remains committed to Prime Air and continues to make great strides toward our vision of delivery in 30 minutes or less by drone. To accomplish that, the e-commerce giant is looking to forge ties with other outside companies, including Austria's FACC Aerospace and Spain's Aernnova Aerospace, according to the FT.
Amazon also has sent out a "request for proposal" to other third-party providers, the FT said.
Amazon has long explored and invested in automation technology within its supply chain to move goods and services as quickly as possible but has struggled with the so-called last mile of package delivery.
Amazon in June formally cut a deal to buy driverless-vehicle startup Zoox for more than $1 billion in a move that will accelerate the e-commerce giant’s reach into autonomous-vehicle technology and implementation and to get it closer to getting goods ordered online directly to consumers' front doors.
Amazon Prime Air, which has been in the works since 2013, in August received permission from the Federal Aviation Administration to start conducting delivery drone operations. Amazon's delivery drones can carry packages weighing under five pounds for 15 miles.
Shares of Amazon were down 0.49% at $3,120.56 in trading on Thursday.