Amazon Set to Divert Freight as Chinese Cities Go Back to Lockdown

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Amazon Set to Divert Freight as Chinese Cities Go Back to Lockdown

China’s zero Covid goal is proving a challenge not just for the locked up Shanghai but for China’s trade partners all around the world.

The UK, which imported nearly £70bn worth of goods from China in 2021 is facing a price increase. Consumers in Canada are heading in the same direction. However, Amazon has something up its sleeve.

Canada’s largest online retailer is set to counter any disruptions by channeling freight to warehouses in unaffected regions.

After the initial supply shortages at the dawn of Covid, multinational companies appreciated global sourcing, making connections with manufacturers from India, Sri Lanka, and Southeast Asia. With the US raising tariffs against China, Southeast Asian countries like Malaysia, Thailand, Indonesia, and Vietnam are seen as the up-and-coming players.

Amazon did not disappoint. The e-commerce giant had purchased more local inventory during the early outbreak of the Omicron variant, prepared for potential disruptions.

“We do not anticipate a significant disruption to our business. We are able to counter these closures by diverting available freight to our neighboring warehouses in the region not impacted by COVID lockdown,” said Amazon Spokesperson Maria Boschetti on Wednesday.

Forty-five cities in China are in varying forms of lockdown until June 1 to contain the highly infectious Omicron variant. This includes border restrictions and halting transportation.

Shanghai and its locked-down neighbors account for 50% of the country’s economy. The economic and social impact of the limited movement is felt throughout the country, especially by workers.

Tech hub Shenzen is among the locked-down cities. The Shenzhen Cross-border E-commerce Association comprises 2,800 retailers, most are present on Amazon. The association voiced concern over possible delays of goods around the world.

The factory shutdowns are also causing delays in deliveries, while logistical difficulties were making it challenging to ship goods to overseas customers.

As of May 27, Shanghai is taking gradual steps on towards lifting restrictions.