Lindt May Shift Canada Chocolate Supply From U.S. Plants to Europe Because of Tariffs
Lindt & Sprungli says it may supply Canada with European-made chocolates instead of American ones because of the tariff war between Canada and the U.S. That could spell trouble for Lindt’s U.S. plants, which currently supply 50% of Lindt chocolates to Canada.
A number of media this morning were reporting that the Swiss chocolatier was considering the supply change in light of Trump’s 25% tariffs on all good imported from Canada, which caused Canada to invoke similar duties on U.S. goods brought into the country.
CEO Adalbert Lechner said Lindt was taking the action to prevent its business in Canada, one of its top 10 markets, from being caught in the cross fire of the trade conflict. "The volumes that we source currently for Canada can all be shifted to Europe," Lechner was quoted in a Reuters report. "We are able to source 100% from Europe," Lechner told Reuters.
Lindt, which has five factories in the U.S., already has built up inventories in Canada from the U.S. to give it time to change its supply chain, which it expects to complete by the middle of the year, said the Reuters report. The company’s CFO said while it would be slightly more expensive to transport chocolate from Europe, it would cost less than the price with tariffs.
He also told Reuters products produced in Europe could face less of a consumer backlash in Canada than chocolates labeled as made in the U.S.