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Amazon (AMZN) Stock: The Great Exodus? Chinese Sellers Ready to Abandon US Market
The recent tariff hikes imposed by the US government could have a devastating impact on Amazon’s business model, with many Chinese sellers considering abandoning the US market altogether. According to reports, China is home to approximately half of Amazon’s global seller base, and any disruption in this supply chain would be catastrophic for the e-commerce giant.
In response to the increased tariffs, Amazon’s prices are set to rise, potentially impacting consumer demand. Furthermore, many Chinese sellers are looking to reduce their investment in the US market by reducing advertising spend on platforms like Amazon. “For us and anyone else, you can’t rely on the US market, that’s quite clear,” said a representative from one such seller.
The tariffs have already had a significant impact on Amazon’s stock price, with shares dropping around 2% in pre-market trading as investors grappled with the potential consequences of this development. The company’s current strong buy consensus on TipRanks suggests a potential upside of 38.05%, but it remains to be seen whether this optimism is justified.
It appears that Chinese sellers are no longer willing to invest in the US market, instead opting to focus on other regions such as Europe, Canada, Mexico and the rest of the world. This shift could have far-reaching implications for Amazon’s business model and revenue stream.
In the short term, it seems that the tariffs will lead to increased unemployment rates in China, particularly affecting small businesses and manufacturers who rely heavily on US sales.
This dramatic change has led some market analysts to speculate about the potential long-term consequences for Amazon.
Source: https://coincentral.com/amazon-amzn-stock-the-great-exodus-chinese-sellers-ready-to-abandon-us-market/
