Ikea closes US plant

Author: Thomas Wandler
Date: 17.07.2019

Excessively high raw material costs

The Swedish furniture group Ikea has announced that it intends to close its only factory in the USA at the end of this year. This means that 300 employees will lose their jobs. This was announced by Ikea on Monday in a press release.

The reason for this is the high raw material prices in the country: production at the Danville plant in the state of Virginia is “significantly” more expensive than in Europe. Although an attempt had been made to increase the factory’s competitiveness, production could not be continued due to rising costs in the USA.

The factory was opened in 2008. Among other things, wooden shelves for the US and Canadian markets were manufactured here. It is also said that Ikea wants to help employees to find new jobs. Ikea manufactures in 24 factories in nine countries and has a total of around 20,000 workers.