Technology
Tuesday, July 26th, 2022 12:44 pm EDT
Amazon is raising prices for its Prime subscription service in the U.K. and across Europe as the e-commerce giant grapples with the effects of rising inflation.
In the U.K., Amazon is set to hike the annual price of a Prime membership to £95 ($114), up from £79, representing a 20% jump. The changes will take effect Sept. 15.
The company is enforcing even steeper price increases in European markets.
In France, the price of an annual Prime membership is going up to 69.90 euros ($70) from 49 euros, a 43% increase. German Prime members can expect a 30% hike in their annual Prime prices to 89.90 euros, up from 69 euros.
The move follows similar price hikes Amazon announced in the U.S. In February, the company said it would raise the price of its annual Prime membership for Americans to $139 from $119, the first such increase to its discount loyalty program in the U.S. since 2018.
Amazon blamed the price rises on “increased inflation and operating costs,” along with higher expenses tied to faster delivery and content production for its Prime Video streaming service, Reuters reported. The company is scheduled to report second-quarter earnings Thursday.
Amazon CEO Andy Jassy has been grappling with the twin challenges of high costs and slowing e-commerce sales. Last quarter, Amazon acknowledged that the Covid pandemic boom had caught up, leaving it with too many workers and too much warehouse capacity. The company has moved to shed some of that warehouse space, and recently paused construction on office buildings in Nashville, Tennessee, and the Seattle suburb of Bellevue, according to The Wall Street Journal.
Amazon has previously said it worked to avoid passing costs from inflation, the Covid-19 pandemic and other macroeconomic challenges onto consumers. Facing rising costs, the company in April added a 5% fuel and inflation surcharge to the fees it charges sellers who use its fulfillment services.
Amazon isn’t the only company raising its prices. Disney earlier this month hiked the price of its sports streaming service ESPN+. And earlier this year, Netflix increased prices in several markets.
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