The recent US import tariffs on specific countries for further processing of furniture imports has set off red flags. Consumers in the United States are now afraid of increasing prices. Under former President Donald Trump, tariffs of 20% on Vietnamese products and 30% on Chinese imports have come into effect, impacting the largest source of furniture for the U.S. market. In 2024, all imports together add up to a truly shocking $25.5 billion imported just in furniture alone. This was a 7% jump over the year, with two-thirds of those imports coming from Vietnam and China.
As a direct result, we have already seen furniture prices start to increase. Between March and June 2024, prices surged by 1.4%, signaling a worrying trend for consumers looking to furnish their homes. Analysts are cautioning that this will not be the only increase. Domestic manufacturers will experience the negative impact of higher costs as furniture components imported from affected countries are forced to pay higher prices.
Market analyst Tyler Schipper discussed how the resulting higher costs have made U.S. products uncompetitive in the domestic market due to tariffs. He stated, “If you put a large tariff on imported goods, it has the effect of reducing competition in the U.S.” Such a decrease in competition would likely encourage domestic manufacturers to increase their prices too. Schipper further emphasized the implications for consumers, stating, “If tariffs go into place, it almost certainly will increase prices for furniture – to furnish that new house or upgrade the couch the dog destroyed or whatever it might be.”
Perhaps most notably, these tariffs are projected to hit companies such as IKEA hard, the multinational conglomerate design and sell affordable, ready-to-assemble home goods. A lot of their product is sourced in Vietnam and China. As the unintended consequences of inflationary policies inflate costs, consumers will eventually be forced to pay the price. Some analysts are still optimistic that suppliers will pick up a portion of these costs to keep prices competitive.
Michael Sposi pointed out that foreign producers will necessarily have to be price competitive on U.S. markets. He pointed out that these tariffs would force a big change in their pricing structure. Despite this possibility, Jason Miller, another industry analyst, expressed skepticism about the overall consumer experience, remarking, “It’s difficult to see many positives from a consumer standpoint at the moment.”
Indeed, Trump has continued to defend his administration’s tariff strategy, claiming that these measures have not started inflation in the U.S. economy. In a recent social media post, he claimed:
“Tariffs have not caused Inflation, or any other problems for America, other than massive amounts of CASH pouring into our Treasury’s coffers. Also, it has been shown that, for the most part, Consumers aren’t even paying these Tariffs, it is mostly Companies and Governments, many of them Foreign, picking up the tabs.”
He expressed optimism about the future of domestic manufacturing in areas like North Carolina and South Carolina:
“This will bring the Furniture Business back to North Carolina, South Carolina, Michigan, and States all across the Union.”
A continuing anti-dumping investigation into imported upholstered furniture is scheduled to finish in another 50 days, which could have an additional impact on market forces. Industry stakeholders are watching the developments with bated breath. They’re anxious to see how long lived these tariffs will be and how they will finally play out with furniture pricing.
As consumers start to brace for major hikes in furniture prices. For how long this will continue and what our manufacturers will do in response, that’s anyone’s guess. Both tariffs and market competition from abroad are directly impacting the world of U.S. furniture manufacturing. In the months ahead, this dynamic may radically change its terrain.
