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The Swedish company will stop production in December at its plant in Danville, Virginia. The activities will be transferred to Europe, where the company claims to be able to reduce costs.
"We have made every effort to improve and maintain the competitiveness of this plant, but unfortunately the cost conditions are not in place to continue production in Danville," said site director Bert Eades in a statement. .
The Danville plant, which opened in 2008, employs 300 people. Wooden products, including shelves and storage units, are manufactured at the factory.
In justifying its decision, Ikea pointed to commodity prices, which are higher in the United States than in Europe. Ikea operates factories in European countries, including Poland, Russia and Sweden.
Senator Tim Kaine, a Democrat from Virginia, tweeted in 2018 that Danville factory workers were worried about the impact of tariffs on costs. Kaine said the factory imports many raw materials.
Since Kaine visited the factory, the Trump administration has imposed tariffs on imports of particle board, a common Ikea material, from China.
Ikea said Tuesday that the decision to close the plant was not related to tariffs. Particle board used at the Danville plant is purchased from US suppliers.
Ikea has manufacturing facilities in nine countries and employs around 20,000 people.
A recent change in Ikea's retail strategy to adapt to the growth of online shopping has resulted in job cuts in other areas of the business. 39; company.
The company said it could create 11,500 jobs as a result of this change.
