IKEA invests €1.2bn to cut prices across Europe

IKEA is investing €1.2 billion to reduce prices across its European markets, including hundreds of home furnishing products and accessories in the UK.

The investment is being made by Ingka Group, other IKEA franchisees and Inter IKEA Group as the retailer looks to improve affordability at a time when consumers continue to face pressure from higher living costs.

Price reductions will take effect from 1 September and will cover hundreds of products across Europe, with average reductions on selected lines ranging from 15% to 25%.

In the UK, IKEA said prices will be reduced on hundreds of home furnishing products and accessories, including a 28% reduction on the BILLY bookcase and a 24% reduction on the TROFAST storage combination.

Other products included in the European price investment include the KALLAX storage range, HEMNES daybed and POÄNG armchair, although the products selected and level of reduction will vary between individual markets.

Germany will see more than 1,500 products reduced in price by an average of 20%, including a 27% reduction on the BESTÅ TV bench and reductions of up to 24% across IKEA 365+ kitchen products.

In Italy, prices on hundreds of products have been reduced by an average of 22%, including the KIVIK sofa and POÄNG armchair.

Juvencio Maeztu, CEO of Ingka Group | IKEA, said the latest investment forms part of IKEA's long-term commitment to keeping prices low rather than representing a short-term promotional campaign.

“Keeping prices low is our long-term commitment and part of our promise to side with the many people,” he said.

Maeztu added that IKEA is prepared to accept lower margins in order to improve affordability, while continuing to invest in accessibility through the opening of smaller stores as part of its wider omnichannel strategy.

The latest reductions follow an investment made during FY24, when IKEA lowered prices on thousands of products across its markets. According to the company, the move helped increase customer visits and the number of orders.

Alongside the European investment, Ingka Group will invest a further €70 million to help offset inflationary and currency pressures in Asia and North America and support lower prices in those markets.

Ingka Group is the largest IKEA retailer, operating IKEA retail businesses across 32 markets and accounting for approximately 87% of IKEA retail sales.

Source: IKEA Press Release