Amazon Relocating Prime Now Delivery Unit to Metro Phoenix From Seattle

Amazon said no to Arizona's bids to host the tech giant's second headquarters.
Amazon said no to Arizona's bids to host the tech giant's second headquarters. Mark Mathosian/flickr
Amazon is relocating an operations team that handles the company's delivery services such as Prime Now from Seattle to metro Phoenix.

The Seattle Times reported on Thursday that the company's 130-person team will close in Seattle as a result. An Amazon employee in Seattle told the Times that employees of the central operations center were being laid off by this June, although the company told them that they would try to find them other jobs.

Prime Now is Amazon's rapid courier service that offers one- or two-hour deliveries from local stores and restaurants. Phoenix residents, for instance, can have groceries from Amazon-owned Whole Foods sent directly to their front door from the service. The unit that is relocating to Phoenix coordinates these Prime Now delivery drivers and is staffed by many part-time employees, according to the Times.

An Amazon spokesperson confirmed to Phoenix New Times on Friday that the jobs will move to the greater Phoenix area, and described the move as a way to use company resources efficiently. The delivery services apparently need room to grow, and metro Phoenix already has more than 7,500 Amazon employees.

Although Amazon would not give an exact location for the new jobs in metro Phoenix, the company has several existing facilities where it could place them, including a Tempe technology operations center, as well as fulfillment centers in Phoenix, Chandler, and Goodyear.

Amazon declined to comment on the number of jobs that are moving, and did not describe in detail the positions that the company will relocate to Phoenix. However, next week, Amazon is hosting walk-in job applications in Phoenix for aspiring operations staff who want to work for $11.25 an hour. The interviews are at the Hilton at Sky Harbor Airport, a stone's throw from Tempe.

The online-retail giant also denied that the move is because of Arizona's lower minimum wage or cost of living. Phoenix is affordable compared to Seattle, a longtime tech hub that has struggled with rising housing costs and congestion since Amazon turned it into a boom town.

In an emailed statement, Amazon said said that it is continuing to hire people around the country.

"We are constantly evaluating headcount needs to ensure we’re dedicating resources efficiently and effectively, so it’s common for there to be minor fluctuations in headcount in different parts of the company," the company statement said. "We work to support any colleagues who may be affected and try to find alternative roles at the company where possible."

Just a few weeks ago, Amazon clashed with the Seattle City Council over a proposed head tax on large companies. The tax, intended to fund affordable housing and the city's homeless services, clearly targeted the city's dominant tech company – Amazon is the biggest employer in Seattle – and passed on May 14. But Amazon pushed back fiercely, and even threatened to hit pause on new construction downtown.

The company says that the metro Phoenix relocation is not a result of the tax fight in Seattle, but it's definitely inopportune timing if the company wants to patch up its relationship with that city.

Phoenix tried in vain to convince Amazon to pick the city for the location of its second headquarters, which is expected to host around 50,000 employees. The company's announcement that it was seeking a home for its new headquarters kicked off a brutal bidding process, where cities around the country pitched the tech company.

New Times revealed in February that the city of Phoenix offered the company some serious public incentives. They included a 20-year tax-sharing agreement, public investment in infrastructure for the construction project, and payments to the company based on a certain number of eligible jobs that Amazon created at the so-called HQ2.

Phoenix submitted the bid with several other cities in the Valley as a package to Amazon, but no Arizona cities made it to the company's shortlist. Tucson sent the company a cactus, which Amazon couldn't accept.
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Joseph Flaherty is a staff writer at New Times. Originally from Wisconsin, he is a graduate of Middlebury College and Columbia University’s Graduate School of Journalism.
Contact: Joseph Flaherty