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Ikea dismantles plans for stores in India

Swedish furniture retailer Ikea has scuttled plans to open stores in India due to regulations preventing foreigners from owning single brand retailers, the company announced on Thursday.

Published: 11 June 2009 12:59 CEST

Ikea dismantles plans for stores in India

Ikea spokeswoman Charlotte Lindgren said a rule preventing stores being 100 percent foreign owned was the reason behind the move.

“We have been having problems with the regulations in India so we took the decision to postpone our expansion because we want to have full ownership of our retail operations,” Lindgren told AFP, denying that the global economic slowdown had influenced the move.

Indian regulations cap foreign investment in single-brand retailers at 51 percent.

Ikea said India remained “a long term potential market” and would continue to lobby for the existing regulations to be changed.

“If and when changes are made to the FDI (foreign direct investment) regulations allowing 100 percent ownership of single brand retailers then Ikea will reconsider its position,” the company said in a statement.

The company’s comments came after India’s Economic Times reported earlier on Thursday that the Swedish company’s planned $1 billion entry into the Indian market had been put on hold after talks with the government broke down.

Ikea announced in 2006 that it wanted to open its first store in India by 2011.

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A file photo at Ikea in Aalborg, where 31 people stayed overnight during a snowstorm on December 1st 2021.

A file photo at Ikea in Aalborg, where 31 people stayed overnight during a snowstorm on December 1st 2021. Photo: Henning Bagger/Ritzau Scanpix

Anyone who has found themselves wandering the mazy aisles of an Ikea might be able to empathise with the sense of being lost in the furniture store for a seemingly indefinite time.

Such a feeling was probably more real than usual for six customers and 25 staff members who were forced to spend the night at the furniture giant’s Aalborg branch after being snowed in.

Heavy snow in North Jutland brought traffic to a standstill and halted public transport in parts of the region on Wednesday afternoon, resulting in a snow-in at Ikea.

“This is certainly a new situation for us,” Ikea Aalborg store manager Peter Elmose told local media Nordjyske, which first reported the story.

“It’s certainly not how I thought my day would end when I drove to work this morning,” Elmose added.

The 31 people gathered in the store’s restaurant area and planned to see Christmas television and football to pass the evening, the store’s manager reported to Nordjyske.

“Our kitchen staff have made sure there is hot chocolate, risalamande, pastries, soft drinks, coffee and the odd beer for us in light of the occasion. So we’ll be able to keep warm,” he said.

“We couldn’t just send them outside and lock the door behind them at our 8pm closing time. Absolutely not. So of course they’ll be staying here,” he added.

The temporary guests were given lodging in different departments of the store in view of the Covid-19 situation, Nordjyske writes.

“For us , the most important thing was to take care of each other and that everyone feels safe,” Elmose said.

At least Ikea’s stranded customers and staff had somewhere comfortable to lay their heads.

The same can unlikely be said for around 300 passengers at the city’s airport who had to stay overnight at the terminal.

The airport was forced to stop flights from 2:30pm yesterday amid worsening weather, which also prevented buses from transferring passengers to hotels.

“We have around 300 people in the terminal right now and have been giving out blankets on the assumption they will be staying here tonight,” Aalborg Airport operations manager Kim Bermann told Nordjyske.

READ ALSO: Ikea reopens in Denmark after country’s worst retail month this century

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