Archive · 2 Sep 2026
Ikea cuts European prices as cost pressures weaken demand
Ikea is making many of its products cheaper in Europe.
It is spending €1.2bn to do this.
Families are being careful with money because living and housing costs are rising.
Fewer people are moving, so they may also be buying less furniture.
Ikea hopes lower prices will encourage people to shop again.
In Germany, more than 1,500 products were reduced, and some UK shelves and drawers also became cheaper.
Ikea is trying to save money by changing packaging, using automation and using more renewable energy.
The company must sell more items at lower prices to make the plan work.
Ikea is investing €1.2bn in price reductions across European markets as households face rising living costs.
More than 1,500 products have become cheaper in Germany, while Kallax and Billy ranges were reduced in the UK.
The move follows two consecutive years of falling revenue and aims to attract cost-conscious shoppers.
Ikea is lowering purchasing, packaging, manufacturing and transport costs while accepting lower margins.
The company has opened smaller European stores and eliminated 850 Inter Ikea jobs as it simplifies operations.
- Who
- Ikea, including its largest retailer, Ingka, and its supply business, Inter Ikea.
- What
- Ikea is investing €1.2bn to reduce prices across European markets.
- When
- The latest reductions began on September 1, following additional cuts during the 2024 financial year.
- Where
- Across European markets, including Germany and the UK.
- Why
- To attract cost-conscious shoppers and stimulate demand after two consecutive years of falling revenue.
- European investment
- €1.2bn is being allocated to price reductions.
- Germany
- More than 1,500 products were reduced; the Poang chair fell to €119 from €179.
- United Kingdom
- The Kallax shelving unit fell to £49 from £60, and the Alex drawer unit to £55 from £70.
- Revenue trend
- Ikea has experienced two consecutive years of declining revenue.
- Pax packaging
- A redesign of the Pax wardrobe range reduced packaging costs by 70%.
- Workforce reduction
- Inter Ikea eliminated 850 jobs in May as part of an effort to simplify operations.
- Additional regional funding
- Ikea is deploying €70m across North America and Asia to manage currency volatility and inflation.