Finance
Top IKEA retailer says in Davos that tariffs could drive prices higher
Published by Global Banking & Finance Review®
Posted on January 20, 2025
2 min readLast updated: January 27, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on January 20, 2025
2 min readLast updated: January 27, 2026
IKEA's CEO warns at Davos that tariffs could raise prices, while noting improved demand and emphasizing climate change concerns.
By Divya Chowdhury and Helen Reid
DAVOS, Switzerland (Reuters) -For budget furniture retailer IKEA, the fewer trade tariffs there are, the better, CEO of Ingka Group, the biggest global IKEA franchisee, told Reuters on Monday as businesses braced for higher possible U.S. tariffs under President Donald Trump.
"We, and I think probably all international companies thrive from harmonised tariffs, if you like, and actually, the fewer the better, because at the end of the day there is a risk in any country with tariffs that you need to, as a company, pass it on to the customers," Jesper Brodin said on the sidelines of the World Economic Forum annual meeting in Davos, Switzerland.
Inflation and high interest rates have had a "damaging" impact on consumers over the past few years, Brodin said, adding that he saw demand improving.
"We are quite optimistic about the outlook and we already see a shift where people are returning to, I would say, a normal situation when it comes to consumption," he said.
"Now we see people returning to bigger investments like wardrobes, kitchens, and so on," Brodin added.
Ingka Group, which runs IKEA stores in 31 countries and accounts for 90% of global IKEA sales, reported a drop in annual net profit and sales last year after cutting prices to lure inflation-weary shoppers back to its big blue stores.
Despite weak consumer demand, Brodin said his only real worry was climate change. Pointing to the severe economic impacts of extreme weather events like the Los Angeles fires, he said leaders of Europe, the U.S., and China must find an aligned approach to combating climate change.
"There is still a myth out there that adapting to mitigate climate change will be an economic loss, in IKEA we have found that is absolutely the opposite," said Brodin.
"We are here to meet other peers and businesses, government leaders in order to speed up the change because the world is not acting fast enough on this."
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(Reporting by Divya Chowdhury in Davos and Helen Reid in London; Editing by Louise Heavens and Bernadette Baum)
The CEO of Ingka Group stated that fewer trade tariffs are better for international companies, as they thrive from harmonized tariffs.
Inflation and high interest rates have had a damaging impact on consumers, but the CEO noted that demand is beginning to improve.
The CEO mentioned that consumers are returning to making bigger investments in items like wardrobes and kitchens.
Brodin expressed that adapting to mitigate climate change can be economically beneficial, countering the myth that it leads to losses.
Ingka Group reported a drop in annual net profit and sales after cutting prices to attract inflation-weary shoppers.
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