President-elect Donald Trump’s planned tariffs may impact furniture retailer IKEA’s ability to keep its prices low, company executives warned on Wednesday.
Trump plans to impose significant tariffs on its major partners like China, including a 25% tariff on imports from Canada and Mexico.
“We believe tariffs will not support… international companies and international trade, with, at the end of the day, that risk turned up on the bills of customers,” Ingka Group CEO Jesper Brodin told CNN on Wednesday.
“Tariffs make it more difficult for us to maintain the low prices and be affordable for many people, which in the end is our goal,” Brodin added.
“We have never experienced a period of benefit when we had high tariffs,” he said, referring both to IKEA and the global economy.
The US is IKEA’s second-largest market, accounting for 13.2% of total sales in the 2024 financial year, after Germany's 15.5% of sales and ahead of France, the UK and Italy.
About 30% of IKEA products are sourced from Asian nations including China with the remaining 70% from Europe, Ingka Group CFO Juvencio Maeztu told Reuters on Wednesday.
"For us, trade barriers around the world, whether it is from one country or another country, are limiting the possibilities to make things more affordable for the many people," Maeztu said.
"We will keep working with governments and with our supply chain to try to mitigate the impact and to hope to secure affordability."
Mexican officials have also warned that Trump’s tariffs will harm all economies involved, including the US.
Economy minister Marcelo Ebrard said Wednesday the tariffs would result in the loss of 400,000 jobs in the US, while also negatively impacting Mexican exports.
Meanwhile, Canadian premiers are meeting virtually with prime minister Justin Trudeau on Wednesday evening to discuss the impact of Trump’s proposal.