IKEA to sell factories as it ‘downscales’ in Russia

Swedish furniture giant IKEA has said it will “scale down” its activities in Russia, after suspending them following the Russian invasion of Ukraine.

It will reduce its workforce and “begin the process” of selling its four factories in the country.

“Businesses and supply chains around the world have been hit hard and we don’t see resuming operations anytime soon,” Ingka Group, which runs most of IKEA’s stores, said in a statement.

“As a consequence, Inter IKEA Group and Ingka Group have now decided to enter a new phase to further reduce IKEA’s business in Russia and Belarus.”

IKEA announced the suspension of its operations in Russia and Belarus last March, as a result of the war in Ukraine.

According to their statement today: “Providing support and safety to co-workers has been a priority ever since, and company groups have been able to guarantee six months of salary for all co-workers, as well as basic benefits.

“Unfortunately, circumstances have not improved and the devastating war continues. Businesses and supply chains around the world have been hit hard and we don’t see resuming operations anytime soon.”

The owner of the Inter IKEA brand, which is also in charge of supply, said it would start looking for new owners in its four factories and reduce the number of employees.

“The import and export of IKEA products in Russia and Belarus remains suspended,” IKEA said.

IKEA opened its first store in Russia in 2000 and now has 17 stores and 14 shopping malls under its business there, it said.

The statement continued: “Import and export of IKEA products to and from Russia and Belarus will remain halted. The two logistics and purchasing offices owned by Inter IKEA in Moscow and Minsk will close permanently.”

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