#Info - Amazon vs. Mercado Libre: an investigation into alleged predatory business tactics in Latin America

Background: A Clash of Titans

Latin America’s e-commerce landscape is witnessing an escalating rivalry between two global giants: Amazon and Mercado Libre (known as Mercado Livre in Brazil). Mercado Libre, established in 1999, has long been the dominant force in the region, building an integrated ecosystem that combines marketplace operations, fintech (Mercado Pago), and advanced logistics. Amazon, the world’s largest e-commerce company, has ramped up its efforts in Latin America, eyeing the region’s untapped growth potential and aiming to erode Mercado Libre’s supremacy.

Amazon’s Aggressive Expansion

In recent years, Amazon has significantly stepped up its Latin American ambitions:

• Shipping and Pricing Tactics: Amazon introduced $5 shipping rates to Argentina and even experimented with $0 fees, targeting price-sensitive consumers and lowering barriers for cross-border purchases.

• Logistics Investments: The company has expanded its distribution network, including the launch of large warehouse facilities in Mexico and improvements in delivery times throughout the region, aiming to match or surpass Mercado Libre’s renowned logistics efficiency.

• Market Entry and Growth: While Amazon’s Latin American operations are still dwarfed by Mercado Libre, its Brazilian site now attracts about 93 million monthly visitors, making it a formidable challenger.

Mercado Libre’s Counteroffensive

Mercado Libre has not stood still in the face of Amazon’s encroachment:

• Logistics and Fulfillment: The company has invested heavily in its logistics network, launching MELI Air (its own air fleet in Brazil) and opening new warehouses to ensure fast, reliable deliveries - even in remote areas.

• Fintech Innovation: Mercado Pago, its digital payments arm, has become a regional powerhouse, driving user engagement and offering services beyond e-commerce, such as credit and digital wallets.

• Market Leadership: As of 2024, Mercado Libre captured roughly 55.6% of the digital retail media advertising market in Latin America, compared to Amazon’s 17.7%. It continues to report robust financials, with Q1 2025 revenue up 37% year-over-year to $5.9 billion and record user growth across its platforms.

Market Share and Competitive Dynamics

Mercado Libre remains the clear leader, but Amazon’s share and traffic are rising steadily. The competition is driving both companies to innovate, particularly in logistics and fintech, as they vie for consumer loyalty and market share.

Allegations of Amazon “Muscling In"

While some industry observers and LinkedIn commentators note that Mercado Libre feels “very threatened” by Amazon’s push, there is no evidence that Amazon is seeking to “end” Mercado Libre’s operations outright. Instead, the rivalry is characterized by:

• Fierce Competition: Both companies are investing billions in logistics, technology, and user experience, aiming to outdo each other in service quality and reach.

• Strategic Differentiation: Mercado Libre’s deep local knowledge, fintech integration, and logistics infrastructure remain significant barriers to Amazon’s dominance.

• Market Growth: E-commerce penetration in Latin America is still lower than in the U.S., Europe, or Asia, leaving ample room for both players to grow without necessarily eliminating the other.

The Broader Competitive Landscape

It’s not just a two-horse race. Asian entrants like Shopee and Shein are also gaining traction, particularly in fashion and with local shopkeepers, further intensifying the competitive environment.

Conclusion

Despite Amazon’s aggressive expansion and the heightened sense of threat felt by Mercado Libre, the narrative that Amazon is poised to end Mercado Libre’s operations is not supported by current market data or financial results. Mercado Libre continues to post record growth, expand its user base, and innovate in logistics and fintech. Amazon, leveraging its global expertise and deep pockets, is making inroads but still trails the local incumbent.

The likely outcome is an ongoing “battle royale” that will benefit Latin American consumers through better services, lower prices, and more choices - perhaps, some may argue, not the elimination of Mercado Libre. The region’s e-commerce future will continue to be shaped by fierce competition.