Ikea, the world’s largest furniture manufacturer, calls for “predictable and consistent” customs policies, following Donald Trump’s decision to tax furniture imports.
Ikea imports a large part of the furniture sold in the United States from Europe, which is subject to a 15% tax according to the trade agreement signed in July between the two blocs and, therefore, is not affected by the 25% rate that came into force on Tuesday, October 14. “Open, rules-based commerce is always better. Naturally, it is good for Ikea, but also for the whole world,” he said.
The world number one in furniture, Ikea, recorded a 1% decrease in its sales in its 2024/2025 financial year, due to the price cuts decided to reactivate activity and the expectant attitude of consumers. Turnover for the staggered financial year ended at the end of August decreased by 1%, to 44.6 billion euros, but volumes and the number of customers increased by 3%, announced Inter Ikea, the group’s main holding company based in the Netherlands.
“Over the past two years, we have prioritized lower prices, volumes and customer growth,” explained Jon Abrahamsson Ring, CEO of Inter Ikea. After deciding on rare price increases after Covid, the Swedish giant spent between 2,000 and 3,000 million euros to lower its prices by 10% in the last two years.
Consumer waiting attitude
Although sales are rebounding in volume, consumer confidence “has stabilized, but remains at a very low level compared to what it was several decades ago,” he added. As a result, these consumers are showing an attitude of waiting before making the decision to buy: “we are seeing it in our 63 markets,” the manager continued.
In the future, Inter Ikea intends to continue lowering its prices “but rather at a normalized level of 1 to 3 percent annually,” according to Jon Abrahamsson Ring. In the immediate term, the 2025/2026 financial year “starts well” with “growth in volume, number of clients and value.”
Logistical difficulties also hampered the group’s ability to meet the demand created by the drop in prices, explained the Ingka group, which brings together the majority of Ikea stores in the world and represents more than 90% of its total turnover.
“We had four to six difficult months to meet demand,” Tolga Öncü, Ingka’s chief operating officer, told AFP. Regarding the wait-and-see attitude of consumers, France, due to political turmoil, and Germany, affected by the difficulties of its automobile industry, have suffered, Öncü said. The exercise was also “very difficult” in China.
Source: BFM TV
