IKEA plans to increase production of furniture in the United States, responding to higher import costs due to tariffs, Reuters reports. Susanne Waidzunas, global supply manager at Inter IKEA, explained the move aims to make the supply chain "more resilient, robust and responsive," reducing reliance on long international shipping routes.
© Grecu Mihail Alin | Dreamstime
Currently, only 15 percent of IKEA products sold in the US are domestically produced, down from 19 percent in 2014. By contrast, Europe and Asia source 70 percent and 80 percent of products locally. The shift will include investment in factories such as SBA Home's automated facility in Mocksville, North Carolina, capable of producing two million pieces annually, including popular KALLAX shelves.
IKEA also plans to source more mattresses and other bulky items from existing US suppliers like Sauder Woodworking, as well as new local partners. While production costs in the US are higher, shipping globally has become increasingly expensive and unpredictable since the Covid-19 pandemic.
The strategy predates recent tariff hikes but is timely, as IKEA has seen sales decline over two years, partly due to price adjustments to counter inflation and maintain its low-price positioning in the US market.
Source: www.manilatimes.net
