Victorinox, manufacturer of the famous Swiss Army knife that excels in multifunctionality, warns that US import tariffs pose a huge challenge for the company. The United States is the company's most important market, and import tariffs are increasing costs by $13(€11,1) million per year, says CEO Carl Elsener in the Italian newspaper Il Sole 24 Ore.
However, he refuses to move production to the US to avoid the tariffs. "The brand is characterised by its Swiss origin."
Since last week, US President Donald Trump has imposed a reciprocal import tariff of no less than 39% on Switzerland. That is considerably more than the 15% imposed on the European Union. As a result, many products from Switzerland – luxury watches, cheese, chocolate, but also the famous multifunctional pocket knife that fits in your pocket – are likely to become much more expensive in the US.
The United States is Victorinox's most important market. Of its turnover of 417 million Swiss francs (€442 million), 13% is generated in the US. The brand is well known thanks in part to American television star MacGyver, who regularly used the Swiss pocket knife in the series of the same name in the 1980s and 1990s.
There are no problems in the short term, says the CEO, because American stocks were replenished considerably before the tariffs were introduced. But from next year, costs are expected to increase by 13 million dollars per year. The import tariffs also come at a difficult time, as the dollar is already cheap against the Swiss franc, putting pressure on American revenues. "The import tariffs pose a huge challenge to our competitiveness."
The company is now looking at the extent to which it can raise its prices or have certain services, such as packaging, done in the US.
