Husqvarna Adjusts Supply Chain Amid 30% US Tariff Threat, Sees 15% Lawn Mower Sales Boost

Husqvarna, a Swedish company, is actively adjusting its supply chain to mitigate the impact of potential tariff increases on European goods by the United States. The Chief Executive Officer of Husqvarna has expressed concerns over the escalating trade tensions, which could significantly affect the company's operations. Currently, the United States imposes a 10% tariff on European goods, but there are proposals to increase this to 30%. This potential change has prompted Husqvarna to reassess its supply chain strategies, as approximately two-thirds of its sales in the U.S. market are derived from imported products, with half of these coming from Europe and the rest from China and other countries.

The company is exploring various options to ensure that its operations remain efficient and cost-effective despite the uncertain trade environment. One of the measures being taken is the relocation of some production from China to Europe. Additionally, Husqvarna is rerouting some of its shipments to Canada to avoid passing through U.S. distribution centers, thereby sidestepping potential trade disputes between the U.S. and Canada. The company is also engaged in price negotiations with suppliers to alleviate the cost inflation associated with tariffs. Beyond tariffs, Husqvarna is facing other pressures on its profit margins, including currency fluctuations and rising raw material costs. In response, the company has implemented several measures, such as closing certain factories and focusing on high-margin products like irrigation systems and automatic lawn mowers.

Despite increasing competition from new players in China, Husqvarna's automatic lawn mowers have seen a 15% increase in quarterly sales. This proactive approach aims to safeguard Husqvarna's market position and financial stability in the face of potential economic challenges. The company is calling for constructive dialogue between Washington and Brussels to address these trade issues and mitigate their impact on global supply chains. The adjustments being made by Husqvarna reflect a broader trend among companies seeking to navigate the complexities of international trade and ensure their long-term sustainability.