Bloomberg Intelligence Amazon Cancels Some Inventory Orders from China
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Apr 9, 2025 Kristina Hooper, Chief Global Markets Strategist at Invesco, shares her sharp insights on current market trends and tariff impacts. The discussion centers around Amazon's strategic cancellation of inventory orders from China to mitigate tariff exposure, suggesting significant ripples in trade relations. Hooper analyzes the broader implications on the markets, comparing the current uncertainty to the early days of COVID-19. She emphasizes the importance of adaptive strategies for investors in this volatile landscape.
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Amazon Cancels Orders
- Amazon cancelled orders for products from China and other Asian countries, including beach chairs and scooters.
- This followed new tariffs imposed by President Trump, increasing Amazon's exposure.
Amazon's Direct Import Strategy
- Amazon uses direct import orders where they buy products directly from vendors in source countries and import them to the US.
- This was cost-effective before tariffs, but now it exposes Amazon to increased costs.
Vendor's Dilemma
- After Amazon cancelled the order, the vendor was left with 500,000 beach chairs.
- The vendor can renegotiate with Amazon, seek other marketplaces, or explore alternative options.