Amazon expands in Brazil, capitalizing on e-commerce boom triggered by COVID-19 distancing

SAO PAULO (Reuters) – Amazon AMZN.O announced Monday that it has opened three more logistics centers in Brazil to take advantage of the push the COVID-19 pandemic has given to e-commerce in South America’s largest economy.

The new units are already operating in the states of Minas Gerais and Rio Grande do Sul and in the capital Brasilia. They bring the number of Amazon logistics centers in Brazil to eight, extending its reach to all corners of the vast country.

The expansion, which adds 75,000 square meters (807,000 square feet) of distribution space, is Amazon’s largest since it began operating in Brazil in 2012. It will create 1,500 direct jobs, a the company said in a press release.

Alex Szapiro, general manager of Amazon in Brazil, said the new centers will allow the company to immediately increase the number of cities where Amazon Prime customers can receive deliveries within two business days to more than 500, against 400.

“Brazil is the country with the fastest growing Amazon Prime subscriptions,” Szapiro told Reuters, referring to the company’s loyalty program, which launched in Brazil in September last year.

In recent months, thousands of Brazilian businesses have migrated to e-commerce platforms following social distancing and lockdown measures.

Despite the gradual easing of measures, the migration to digital sales continued.

Last week, MercadoLibre Inc MELI.O, Leader of e-commerce in Latin America, announced that its net sales in the region climbed almost 150% in the third quarter, measured in local currencies.

MercadoLibre’s activity in Brazil, which represents more than half of its total activity, has more than doubled.

Other companies in Brazil, including Via Varejo VVAR3.SA, GPA PCAR3.SA and Luiza Magazine MGLU3.SA, are buying logistics startups to ride the same wave of e-commerce.