Reckitt Benckiser Plc, a leading consumer goods company that imports over 40% of its products into the U.S., is ramping up domestic production in response to potential tariffs under President Donald Trump’s administration. The company plans to reduce its reliance on imports, with a goal to lower its share of imported goods to 25% by 2027. This will be achieved through the establishment of an over-the-counter manufacturing plant in North Carolina, where Mucinex tablets and liquids will be produced. The plant’s development is part of a £155 million ($200 million) investment, expected to generate nearly 300 jobs.
Shannon Eisenhardt, Reckitt’s Chief Financial Officer, highlighted the company’s ongoing strategy to increase local manufacturing in the U.S. “We’ve been discussing for a while the opportunity to continue to increase the percentage of local manufacturing within the US,” she said during a visit to the company’s research and development facility in Taicang, China.
The shift to more local production comes amid President Trump’s proposal of imposing tariffs ranging from 10% to 20% on imported goods, and potentially higher tariffs on goods from China. These tariffs would create a competitive disadvantage for Reckitt compared to U.S. manufacturers like Church and Dwight Co., which produces Trojan condoms, and Kenvue Inc., which makes products like painkillers.
Despite these challenges, Reckitt’s continued imports will include products such as condoms from Thailand and Mucinex from Mexico. However, the company’s exposure to tariffs remains higher than some other multinational corporations. For instance, Nestlé SA produces nearly 95% of its U.S. sales domestically, as noted by CEO Laurent Freixe in November.
Focus on Developing Markets
While North America, particularly the U.S., represents less than a third of Reckitt’s global revenue, the region has faced declining sales, particularly in its infant formula division. The company has been embroiled in lawsuits linking its milk-based formula to necrotizing enterocolitis, a serious bowel condition in preterm babies, which has caused a drop in stock prices. Reckitt, along with Abbott Laboratories, which faces similar lawsuits, denies any connection between its products and the illness.
Despite the challenges in the U.S. market, Reckitt is focusing on growth opportunities in developing markets, including China. Sales in China grew almost 4% on a comparable basis during the first three quarters of the previous year.
The company’s Taicang facility, which currently produces Dettol products, will begin manufacturing Durex condoms in early 2026. Reckitt is investing 300 million yuan ($40.9 million) to build a new R&D center in Shanghai, further strengthening its commitment to the Chinese market.
“We don’t want the China story to be a boom and bust story. We want to deliver sustainable growth here,” Eisenhardt stated, emphasizing the importance of the Chinese market as a long-term opportunity for Reckitt. The company plans to continue investing in its operations, marketing, and facilities in the region.
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