Trump tariffs mean higher prices and big losses for Amazon sellers that source from China
President Donald Trump’s aggressive tariff policy on April 2 didn’t just cause mayhem in the stock market.
President Donald Trump’s aggressive tariff policy on April 2 didn’t just cause mayhem in the stock market. It sent Amazon sellers into a panic.
Many sellers on Amazon count on China for manufacturing and assembly due to lower costs and established infrastructure — up to 70% of goods on Amazon come from China, according to Wedbush Securities. With nearly all imports from China being taxed a staggering 145% under the latest tariffs, Amazon sellers are having to decide whether to raise prices or absorb the vastly increased cost of importing their goods.
Amazon CEO Andy Jassy on Thursday told CNBC that its vast network of third-party sellers will likely “pass the cost on” to consumers. He added that Amazon has done some “strategic forward inventory buys” and looked to renegotiate terms on some purchase orders to keep prices low.
Although Trump temporarily lowered tariffs on most countries to 10% on Wednesday, he doubled down on the huge tariffs on goods from China. Before the pause, average tariff rates under Trump were at the highest level since the Great Depression. The “reciprocal tariffs” were far steeper in regions like Southeast Asia. Tariffs also hit U.S. allies at unusual rates, including 20% on the European Union and previously announced 25% tariffs on Mexico and Canada.
Josianne Boisvert of Canadian-based Portable Winch Co. said she “was in a state of shock” when the tariffs were announced. For 20 years, the company has driven its products an hour to the U.S. border for duty-free shipping to American customers.
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