IKEA plans to stick to previously announced price cuts despite ongoing disruptions to shipping in the Red Sea.

Speaking at the Reuters Global Markets Forum in Davos, Jesper Brodin, the chief executive officer of Ingka Group which owns most IKEA stores worldwide, said that while disruptions are pushing up costs, the company has sufficient stocks to absorb these kinds of impacts to its supply chain.

Houthi militants in Yemen have disrupted global commerce by attacking civilian ships, causing shipping firms to reroute vessels around the southern cape of Africa.

Across most companies, the higher transport costs are likely to fall on consumers who have spent the past two years struggling with a cost-of-living crisis, but IKEA is not one of them

Brodin said that "our commitment is to make sure that we prioritise investing in lower prices for our customers," adding that while he predicts "quite significant deflation” in the company’s supply chain, profits are not at the fore of his mind for 2024.

He added: "This is not a year for us to optimise profits. This is a year to try to navigate on a thinner profit, but to make sure that we support people."

IKEA has historically benefitted from times of economic downturn, with its low-cost homeware goods serving as a stable alternative for consumers.

Also at the conference, Brodin said that the company intends on expanding its presence in China and India.

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