Amazon is facing a US$280 million lawsuit from Gilimex, a Vietnamese manufacturer based in Ho Chi Minh City, saying that the US tech giant has scaled back orders after it already boosted capacity, Bloomberg reported.
The suit was filed in New York State Supreme Court against Amazon Robotics.
According to Gilimex, which partnered with Amazon from 2014 to 2022, it had already invested an eight-digit US dollar amount into manufacturing facilities after sealing the deal with the tech giant. The upped investment also involved recruiting 7,000 workers.
Bloomberg did not receive comments from Amazon regarding the situation.
The report noted that the pullback from the US-based firm, which happened in April and May this year, comes as online spending slowed down significantly in the post-Covid era.
Gilimex said it had to put aside commitments for other big customers such as Ikea and Columbia Sportswear to serve the demand from Amazon. According to KB Securities, the Vietnamese firm accounts for more than 50% of Amazon Robotics’ fabric pod array imports.
According to local media reports, Gilimex’s revenue in the third quarter of 2022 stood at 213 billion dong (US$9 million), an 83% drop compared to the previous quarter.
See also: Anti-Amazon alliances inspire sellers who shun Southeast Asia’s marketplaces
Currency converted from Vietnamese dong to US dollar: US$1 = 23,555.00 dong.
Editing by Thu Huong Le and Lorenzo Kyle Subido
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