Internal emails and court claims reveal that Amazon employed a range of tactics which incentivised suppliers to raise prices on competitor websites such as Walmart and Target, according to documents reviewed by the Guardian. The California attorney general alleges that the world’s largest retailer engaged in widespread price fixing, coercing suppliers into increasing costs for consumers elsewhere.
Specific examples cited include a table lamp that rose from $24.99 to $39 on Walmart’s site, an air fryer that jumped from $84.99 to $149.99 on Newegg, and an ice-cream maker that more than tripled in price on Amazon after being removed from Best Buy. The changes were not due to normal market forces but resulted from Amazon’s pressure on suppliers, the court documents claim.
Amazon’s methods included flagging low prices on rival platforms as threats to its own profitability, then cutting or threatening to cut a supplier’s sales on Amazon.com. In other cases, Amazon matched competitors’ lower prices and demanded compensation from suppliers for the lost revenue. Suppliers, facing financial strain, often responded by raising prices on Amazon’s rivals or removing products from those platforms altogether.
The California lawsuit, brought by Attorney General Rob Bonta, relies on a trove of internal Amazon emails, presentations and depositions. The documents describe how Amazon suppressed sales of certain products or demanded millions in reimbursements to offset the cost of price-matching competitors.
In the ice-cream maker case, emails show Amazon temporarily removed the supplier’s inventory, prompting the manufacturer, Maxi-Matic, to pull its product from Best Buy. Amazon then reinstated the item at more than triple the original price. For the air fryer, Amazon suppressed sales and told supplier Chefman it would stop ordering several products unless Chefman reimbursed Amazon for losses incurred from price-matching. Chefman agreed to pay $100,000 on top of $400,000 already given back, and secured price increases at Target and Newegg.
Mark Friedman, Chefman’s senior vice-president of global sales, declined to comment in detail, saying: “I can’t talk to you because I still do business with Amazon and I don’t want to bite the hand that feeds me.” Amazon has denied the price-fixing allegations and maintains that it works to lower costs for consumers.
