CNN Business has learned that Amazon will increase the price of its annual and monthly membership fees, with the changes expected to take effect in the coming weeks.
The online retail giant made the announcement on Thursday, along with its earnings report, saying the annual fee will increase from $119 to $139, and the monthly fee will drop from $12.99 to $14. $.99. Amazon Prime Vice President Jamil Ghani said the reason for the price hike was “continued expansion of Prime member benefits as well as rising wages and transportation costs.”
The price hike will affect new members on February 18, while existing members will be affected after March 25.
This is the third time Amazon Prime has raised membership fees since its launch. The previous cases happened in 2014 and 2018 where each time the price increased by $20. As well as becoming a seemingly four-year event, Neil Saunders, chief executive of research firm GlobalData, told USA TODAY the announcement was “long overdue.”
“Amazon faces much higher costs and is still investing heavily in Prime, so there is real justification for raising fees,” Saunders explained.
Amazon decided to raise its membership fees at a time when the company reported a fourth-quarter profit of $14.3 billion, according to Yahoo! Finance. The figure, which nearly doubles the $7.2 billion earned during the same period in 2020, was likely linked to Amazon’s support for electric vehicle company Rivian Automotive.
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