Amazon CEO: Tariffs Haven't Brought Down Demand…Yet
'We haven't seen any attenuation of demand yet. To some extent, we've seen some heightened buying in certain categories that may indicate stocking up in advance of any potential tariff impact,' Jassy said in a Thursday earnings call. 'We also have not seen the average selling price of retail items appreciably go up yet. Some of this reflects some forward buying we did in our first-party selling, and some of that reflects some advanced inbounding our third-party sellers have done. But a fair amount of this is that most sellers just haven't changed pricing yet.'
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Jassy said the company had been encouraging its sellers to pull forward goods so they could have inventory on hand in the U.S., thus keeping prices down.
The comments came weeks after a report indicated that Amazon had canceled orders for multiple products made in China. More than 70 percent of sellers and brands on Amazon say they source their products from the country, according to a survey from Amazon seller software platform Jungle Scout.
In the call, Jassy spoke favorably of sellers that source directly from China.
'As it relates to China, retailers who aren't buying directly from China are typically buying from companies who themselves are buying from China, marking these items up, rebranding and selling to U.S. consumers,' Jassy said. 'These retailers are buying the product at a higher price than Chinese sellers selling directly to U.S. consumers in our marketplace, so the total tariff will be higher for these retailers than for China direct sellers.
Addressing the concerns that the tariffs on China would be passed onto consumers, Jassy admitted it would be a mixed bag of sorts.
'When you've got 2 million-plus sellers, they're not all going take the same strategy if there ends up being higher tariffs. There are going be plenty of sellers that decide to pass on those higher costs to end consumers,' said Jassy. 'Not all of them are going to pursue the same tack. When you've got larger diversity like we have, we have a better chance of some of those sellers deciding that they're going to capture share, and they're not going to pass on all or any of those tariffs to the customers.'
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