A view shows the logo of IKEA on a closed store in Kotelniki


  • Due to high inflation, IKEA was forced to create more affordable products
  • The $2.2 billion investment will create 2,000 jobs over the next three years
  • IKEA has remained afloat amid the supply-chain blockages and rising cost of materials

Swedish furniture store IKEA is about to make its biggest investment in the United States, spending a whopping $2.2 billion over the next three years to open up new stores and upgrade the existing ones.

In an announcement on Thursday, IKEA said that of the 17 new facilities they are set to open, eight would be new stores and nine are "plan and order points," where customers can speak with in-house consultants to plan the layout of their desired furniture and place orders.

The investment is seen as an effort by the company to win over cash-strapped U.S. consumers seeking to buy more affordable products.

As IKEA's biggest rivals, such as Walmart and online furniture store Wayfair, cut jobs and shut down stores due to lower consumer spending, the situation creates an opportunity for the Swedish furniture giant to pick and choose cheaper stores and warehouse spaces.

The investment of Ingka Holding BV, the largest owner and operator of IKEA stores in the U.S., will also be used to strengthen the company's fulfillment network to improve its delivery services, and in the process create 2,000 jobs.

"The US is one of our most important markets, and we see endless opportunities to grow there," said Tolga Öncü, head of retail at Ingka, noted the Wall Street Journal.

"More than ever before, we want to increase the density of our presence in the U.S."

Although the specific locations of the new facilities have yet to be confirmed, the retailer is expected to make large investments in the south, following its announcement of new store openings in San Francisco, California and Arlington, Virginia.

With the world beginning to slowly ease mobility restrictions and global supply-chain blockages, the U.S. demand for IKEA products has been strong so far this year, Öncü noted. The company has been forced to focus on producing more affordable products for consumers still struggling with inflationary prices.

Although IKEA's expansion plan has been in development for some time, Öncü said that the passage of the Inflation Reduction Act helped the company make up its mind on expanding investments in the country.

"There is an opportunity for IKEA, more than ever with the circumstances that the world is in, to double down on our investments," Öncü added.

IKEA first opened its U.S. store in 1985. Next to Germany, the U.S. is its biggest market in terms of sales, with a total of 51 stores all over the country, excluding the two new locations in San Francisco and Arlington.

Ikea will hike its prices by an average of nine percent next year
Ikea will hike its prices by an average of nine percent next year AFP / Emmanuel DUNAND