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A chocolate company has a sweet plan to shield itself from the tariff war that broke out this week between the U.S. and Canada.
Swiss chocolate maker Lindt and Sprungli said the supply of their confectionery to Canada is in the process of switching to all European sources of chocolate.
Stores in Canada import about 50% of the chocolates from the company’s U.S., factories while the rest comes from Europe.
“We are monitoring the situation very closely and have identified different ways to mitigate the effect of tariffs,” a Lindt spokesperson told Fox News. “These include the possibility of supplying countries like Canada and Mexico from our European production facilities.”
On Tuesday, U.S. President Donald Trump imposed 25% tariffs on all Canadian products entering the U.S., while Canada retaliated immediately with 25% tariffs on a list of U.S. goods worth $30 billion.
Lindt CEO Adalbert Lechner said the company has already increased inventories in Canada to give it time to change supply chains, which is expected to be completed by the summer.
“The volumes that we source currently for Canada can all be shifted to Europe,” Lechner told Reuters after Lindt reported its full-year results.
Lechner said Canada is one of the company’s top 10 markets.
Chief financial officer Martin Hug told the outlet the cost of transporting their chocolate supply from Europe to Canada would be a little more expensive, but paying the Canadian tariff would cost a lot more.
He said the company also worries about the Canadian consumer backlash as the chocolates have “made in U.S.” labelling.