Pandora CEO shuns US production, warns tariffs may boost prices
Alexander Lacik, whose company makes more pieces of jewelry than any other in the world, said in a Bloomberg TV interview on Wednesday that high labor costs and a lack of skilled craft workers prevent him from starting US-based manufacturing.
Pandora currently makes 95% of its jewelry in Thailand, which US President Donald Trump has threatened to hit with 36% import tariffs. Pandora also next year plans to open a plant in Vietnam, a country the US has threatened with levies of 46%.
Moving to the US 'simply wouldn't work for us because of us being an affordable proposition,' Lacik said in the interview. 'This tariff is an unwelcome aspect.'
Pandora is branding itself as an affordable luxury brand, but was forced to raise prices twice over the past year to offset the impact from higher silver prices. If Trump implements the global tariffs when the 90-day pause ends, the Danish jeweler may raise prices further, Lacik said.
'There is not enough efficiency that I could generate in our production or value chain to cover tariffs of, let's say, 40%,' he said in a phone interview. 'It will be passed on to consumers in one way, shape or form.'
Following Trump's tariff announcement in early April, Pandora initially said the total impact from the levies would amount to about 1.2 billion kroner ($182 million) annually, with a 2025 cost of about 700 million kroner. However, given the current tariff pause, Pandora has excluded any tariff impact from its 2025 guidance and on Tuesday in its first-quarter earnings report reaffirmed its full-year organic revenue forecast, while trimming its profit margin outlook to reflect currency headwinds.
'If tariffs are 40%, then I have no visibility on what my context looks like, so therefore no point in guiding,' Lacik said. 'The moment I know, then we will have to go back and either confirm the current guidance or adjust it a little bit. Who knows?'
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