IKEA closing only U.S. plant due to high material costs
IKEA,North America,plant,cease production
IKEA announced it will cease production at its Danville, Virginia plant in December. The company said it will move production to existing plants in Europe, eliminating an estimated 300 jobs in the United States, according to Woodworking Network.
High costs for raw materials were cited for the closure, which was announced July 10. The company has said it could produce the same products at a much lower cost from its European facilities, and ship them to North America. Products currently produced at the Danville facility include KALLAX shelving units and BESTÅ living room storage units.
The 930,000-square-foot manufacturing plant opened in 2008 and is the only North American production facility for the furniture giant.
"This was an extremely difficult decision to receive. We made every effort to improve and maintain the competitiveness of this plant, but unfortunately the right cost conditions are not in place to continue production in Danville, VA for the long-term," said Bert Eades, site manager for IKEA Industry Danville.