Here's Why Amazon Is Abandoning Dozens Of US Warehouses

Amazon.com, Inc AMZN has abandoned many existing and planned facilities around the U.S. due to slow sales growth. 

Bloomberg quoted consulting firm MWPVL International Inc. saying that Amazon will not open 42 facilities spread across 25 million square feet of usable space. 

According to MWPVL, the company has also delayed opening an additional 21 locations, making up about 28 million square feet. 

Amazon is also planning to shut down delivery stations in Hanover and Essex, near Baltimore, where it has close to 300 employees.

The company has sought to sub-lease at least 10 million square feet of warehouse space.

“There remains some serious cutting to do before year-end -- in North America and the rest of the world. But, having said this, they continue to go live with new facilities this year at an astonishing pace,” Bloomberg quoted Marc Wulfraat, MWPVL’s founder and president. 

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Wulfraat also said that most of the closings announced in 2022 are delivery stations and smaller buildings.

According to MWPVL, Amazon operates more than 1,200 logistics facilities, large and small, around the U.S.

However, Amazon spokesperson Maria Boschetti told the outlet that the Maryland closings are part of an initiative to shift work to more modern buildings. 

“We regularly look at how we can improve the experience for our employees, partners, drivers, and customers, and that includes upgrading our facilities,” Boschetti said. 

Amazon reduced its workforce by nearly 100,000 people in the June quarter. About a 6% reduction was the company’s largest cut in a single quarter.