Amazon CEO says Trump tariffs are beginning to push prices higher

Amazon CEO Andy Jassy

• Amazon CEO says Trump tariffs now impacting prices on some platform products
• Sellers are passing on costs, absorbing impact, or finding a middle ground
• Consumers are trading down or delaying expensive purchases due to higher prices

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Amazon CEO Andy Jassy said on Tuesday that tariffs imposed by US President Donald Trump are increasingly being reflected in the prices of some products sold on the platform, as merchants decide how much of the added cost they can absorb.

Speaking to CNBC at the World Economic Forum in Davos, Switzerland, Jassy said Amazon and many third-party sellers had stocked up on inventory in advance of the tariffs in an effort to shield customers from price increases. That buffer, however, has largely been exhausted.

“Most of that inventory ran out last fall,” Jassy said. “So you start to see some of the tariffs creep into some of the prices, some of the items.”

According to Jassy, sellers are now taking different approaches. Some are passing on the higher costs to consumers through price increases, others are absorbing the impact to protect demand, while many are adopting a middle ground. “I think you’re starting to see more of that impact,” he said.

The remarks represent a notable change in tone from last year. In the months following the announcement of the tariffs, Jassy had said Amazon had not seen prices “appreciably go up.” In April, he also warned that many businesses simply did not have enough margin to fully absorb the additional costs.

“Some businesses don’t have 50 percent extra margin that you can play with,” Jassy said at the time.

Amazon sellers have previously told CNBC that higher import costs had already forced them to raise prices on certain items. A major retail trade association also warned last August that the trade war would affect inventory planning in the spring, potentially leading to higher prices, fewer products on shelves, and job losses.

Jassy said Amazon is doing what it can to keep prices low, but acknowledged that there are limits. “Retail is a mid-single digit operating margin business,” he said. “If people’s costs go up by 10 percent, there aren’t a lot of places to absorb it. You don’t have endless options.”

Despite the pressures, Jassy said consumers remain resilient and continue to spend. That said, Amazon has noticed shifts in buying behaviour. Some shoppers are trading down to lower-priced items and hunting for bargains, while others are delaying purchases of more expensive discretionary goods.