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Amazon (AMZN) Faces Strike in Germany Over Work Condition

Amazon AMZN received a jolt amid its preparation for its annual shopping event — Prime Day — in the form of a worker strike in Germany.

Reportedly, the Verdi union has organized a three-day strike with workers from Amazon’s seven German warehouses to protest against poor pay and unfair working conditions.

Moreover, the union has claimed that workers do not get paid an extra cent for the heavy work pressure and super-fast delivery during the shopping rush.

Disruption at Amazon

The workers’ walkout during the peak shopping hours is a huge concern for Amazon.

Notably, the strike coincides with the first day of the company’s mega summer shopping event, which is likely to mar its Prime Day prospects.

Warehouses aid the company in storing and shipping products, and handling returns quickly. These are crucial for Amazon as they help in providinga better shopping experience to its customers. Also, the company’s robust delivery network helps in the ultrafast delivery of orders.

We note that Germany remains one of the key markets for Amazon’s e-commerce business. Thus, the latest move of workers is likely to disrupt the company’s capacity to cater to the rising customer demand in the Prime Day event.

Consequently, this might impact the performance of the company negatively. All these might turn the investors apprehensive about the stock., Inc. Price and Consensus, Inc. price-consensus-chart |, Inc. Quote

Amazon’s Stance

However, the company has reportedly claimed that the workers are availing excellent work environment. with good pay and other benefits.

Additionally, an entry-level wage of 12 euros ($14.25) per hour at Amazon’s German warehouses will be offered to the workers starting from July. Further, the wage is expected to reach at least 12.50 euros per hour by autumn 2022.

The endeavors of the company remain positives and are likely to drive its sales in Germany.

Moreover, Amazon’s robust fulfillment network in the country is capable of negating the impact of the underlined strike.

Additionally, the company’s strengthening initiatives for the event, which are focused on providing an enhanced shopping experience on its robust product offerings, deep discounts on various items and Prime benefits, are likely to aid it in gaining traction among customers.

Further, its automation drive-through robots in its fulfilment centers are on a high and remain major positives.

The above-mentioned facts are likely to continue to aid the company’s Prime Day sales growth and market position.

Zacks Rank & Stocks to Consider

Currently, Amazon carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the retail-wholesale sector are Five Below FIVE, AutoNation AN and Americas CarMart CRMT. All the three stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Long-term earnings growth rates for Five Below, AutoNation and Americas CarMart are pegged at 32.55%, 19.96% and 13.55%, respectively.

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