Amazon shares slide after yet another Trump attack
President tweets that tech giant causing ‘great damage’ to retail, leading to ‘many jobs being lost!’
LONDON— U.S. President Donald Trump once again unloaded on Amazon.com, tweeting that the company is hurting other retailers and implying that it’s killing industry jobs across the U.S.
Amazon is causing “great damage to tax paying retailers,” Trump said in a Twitter post Wednesday, causing shares in the online retailer to fall as much as 1.2 per cent in early trading. It closed down 0.46 per cent. “Towns, cities and states throughout the U.S. are being hurt — many jobs being lost!” Trump said in the tweet.
Trump is losing the support of many company executives. On Wednesday, he said he would be disbanding two advisory groups of business leaders, after CEOs quit this week as the president faced blowback for failing to sufficiently condemn white supremacists. In the past, Trump has often taken particular aim at Amazon and the Washington Post, owned by Amazon founder Jeff Bezos, for its coverage. (The Post is in a business partnership with Bloomberg.)
While it’s unclear what prompted Trump’s tweet, which seems to be taking on two issues — taxes and jobs — the Washington Post ran a scathing editorial Wednesday about Trump in the paper, and pro-tax reform advertisements also ran on early-morning talk shows.
It’s often difficult to parse Trump’s tweets, but he seems to be focusing partly on how Amazon’s sales and market share growth is hurting the traditional retail industry.
His remarks come amid one of the most tumultuous years in the industry’s history. Brick-and-mortar chains, especially apparel sellers, are suffering from sluggish mall traffic and an exodus of shoppers to e-commerce.
A rash of chains have filed for bankruptcy this year, including Payless, Gymboree, H.H. Gregg and RadioShack. And the biggest department-store companies, such as Macy’s, Sears and J.C. Penney, are shuttering hundreds of locations.
The total number of store closings is expected to hit a record in the U.S. this year, with Credit Suisse Group analyst Christian Buss estimating that the number could exceed 8,000.
On the other hand, Amazon is hiring rapidly.
The online behemoth has pledged to hire more than 100,000 workers by 2018, and has been holding job fairs all over the U.S. In some cases, fired department-store workers are ending up at Amazon fulfilment centres.
In his tweet, Trump also hammered Amazon again on tax-related allegations.
It’s unclear exactly what he means since the company has been opening distribution centres everywhere and now collects sales tax in each state that has one.
In June, Trump posted a tweet attacking “Amazon Washington Post, sometimes referred to as the guardian of Amazon not paying internet taxes.”
In December 2015, Trump also described the Post as a tax shelter that Bezos uses to keep Amazon’s taxes low. Without these arrangements, Trump argued, Amazon’s stock would “crumble like a paper bag.”
Bezos actually owns the Post via a holding company separate from Amazon.
Amazon did not respond to a request for comment.
Amazon has been battling a number of politicians from both the U.S. and Europe about its stance on tax. In the U.S., Amazon previously fought to only collect sales taxes for purchases in states where it doesn’t have a physical presence.
The U.S. retailer is currently fighting the European Union over its tax bill, while in March it won a $1.5-billion (U.S.) tax dispute with the Internal Revenue Service.
In 2015, Trump described the Washington Post as a tax shelter used to keep Amazon’s taxes low