Swiss Army Knives "face" Trump tariffs - Manufacturers shift focus to Asia and Latin America
Swiss knife maker Victorinox is adapting to the new global market shaped by U.S. President Donald Trump's tariffs. The company is reviewing packaging strategies, adding inventory, cutting costs in Switzerland and expanding further into markets in Asia and Latin America.
Trump imposed a 39% tariff on Switzerland in August in an effort to reduce the US trade deficit with the Alpine country and encourage more manufacturing within the US. But Victorinox says the special value of its multi-tool knives lies precisely in the fact that they are made in Switzerland.
"We are trying to reduce our dependence on the US market by expanding into other markets such as Latin America and Asia," said CEO Carl Elsener, the great-grandson of the founder of the company that was founded in 1884. "If the 39% tariff remains, every product we export to the US will be at a loss," he said.
Victorinox, which makes about 10 million Swiss Army knives a year as well as kitchen knives, professional knives, watches and luggage, is one of many domestic manufacturers concerned about the high cost of trading with the U.S. In 2024, the U.S. accounted for about 13% of its revenue of 417 million Swiss francs.
Victorinox's multi-tool knives became popular among American soldiers stationed in Europe after World War II. The company is taking steps to protect its presence in the United States, where it has about 100 employees in sales, marketing and logistics.
In February and March, Victorinox shipped two additional containers and filled its U.S. warehouses with about 200,000 Swiss Army knives and 200,000 kitchen knives. This pre-stocked inventory will ensure sufficient supply through the end of the year and partially through March, enabling the company to maintain stable prices in the U.S. through 2026.
Victorinox considered moving some of its production to the United States or Europe to avoid tariffs, but rejected the idea as it would not be economically viable. The Ibach factory produces 135,000 different knives every day, making it difficult to split production.
However, the company is considering moving some of the final processing, such as cleaning and packaging of kitchen knives, to the US to reduce the value on which customs duties are calculated, which could save around 500,000 francs.
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