After the implementation of tariffs on furniture in the United States, the world’s largest home furnishing retailer IKEA is preparing to end years of price reductions and increase the prices of some products in its US stores.
In recent years, as a means to attract consumers amid a backdrop of inflation, IKEA has significantly lowered prices of bookshelves and bed frames as part of promotional activities, but these promotions have impacted the company’s revenue.
According to reports by The Wall Street Journal, Tolga Öncü, the retail manager of Ingka, the company responsible for IKEA stores, stated, “Our goal is to continue lowering prices. However, in the world we live in, sometimes lowering prices can become very difficult, even impossible. We must adapt and pass on some of the increased costs to customers.”
Tariffs have already raised prices of certain product categories at IKEA’s US stores. Based on archived web page information, the price of the Uppland sofa at IKEA has increased from $849 in August to $899. The price of a three-piece oak bedroom set has risen from $959 two months ago to $1049.
Inter IKEA, the parent company of IKEA, stated that due to the impact of price reductions, IKEA’s total retail turnover declined for the second consecutive year. By the end of the 2025 fiscal year in August, sales at all IKEA stores (including those operated by Ingka and other franchisees) dropped slightly by 1% to €44.6 billion (approximately $52 billion). However, sales volume increased by 3%. The full-year performance for this fiscal year will be announced in November.
The new tariffs on wood imposed by the US took effect on Tuesday, October 14. The new tariffs impose a 10% ad valorem duty on softwood lumber imports and a 25% ad valorem duty on certain soft cushion wood products, with tax rates set to increase again next year.
Jon Ring, the CEO of Inter Ikea, the owner of the IKEA brand, told the Financial Times that since most IKEA products in the US are imported from Europe, he holds a “cautiously optimistic” view on the impact of the latest tariffs.
While the US generally imposes a 15% tariff on products exported from the European Union, the more punitive tariffs on wood products do not apply. In contrast, most of IKEA’s competitors import from Asia, which may face higher tariffs.
“We hope to continue expanding in the US and Canada—how to optimize a good supply system, ensure the right materials, components, and production? This is a long-term effort we are undertaking,” he said.
The US is one of IKEA’s largest overseas markets. However, only about 15% of the products sold by IKEA in the US are sourced locally. In comparison, local products make up 75% of the merchandise in European stores and an even higher 80% in Asian stores.
In recent years, IKEA has also been committed to nurturing American suppliers, alleviating some of the impacts of tariffs. Currently, all kitchen cabinets sold to the US market by IKEA are sourced locally, avoiding the impact of the 25% tariff that took effect this week. At the same time, IKEA is considering purchasing mattresses and other products from local suppliers to bypass tariffs.
IKEA is preparing to open new stores in the US within the year, including a new store in Manhattan’s SoHo area. Additionally, the Swedish retailer plans to open kitchen planning studios in 10 Best Buy stores within the year to expand its business in small American cities.