Husqvarna Group Partners with Flex Ltd for Enhanced North American Operations

Husqvarna Group Expands Horizons with Flex Ltd Partnership

Husqvarna Group, a leader in outdoor power products, is making noteworthy strides in North America by forming a strategic alliance with Flex Ltd., a globally recognized manufacturer. This collaboration marks a pivotal shift for the company as it focuses on enhancing operational flexibility and long-term profitability.

The partnership involves the immediate divestment of Husqvarna's manufacturing operations located in Orangeburg, South Carolina. Instead, Flex Ltd. will take on the production of Husqvarna's wheeled and handheld products through a long-term supply agreement. This move aims to ensure a consistent and efficient production process tailored specifically for the North American market.

CEO Pavel Hajman expressed that this new strategic maneuver is vital for Husqvarna, especially within their Forest and Garden Division. By transitioning manufacturing responsibilities to Flex, Husqvarna is poised to refine its operational efficiencies while simultaneously securing the production of key products destined for the North American consumers.

The transition is expected to yield significant cost benefits, projected at around SEK 350 million over the next five years. However, there will be one-time costs incurred by Husqvarna, estimated at SEK 250 million in the fourth quarter of 2024, alongside additional limited costs anticipated in the first quarter of 2025. This financial strategy underscores Husqvarna's commitment to navigating cost efficiencies in light of fluctuating market demands.

One of the major intentions behind this partnership is to bolster Husqvarna's competitive edge. North America is not only Husqvarna's largest market, accounting for approximately one-third of the company's total sales in 2024, but it's also a region undergoing rapid changes. The Husqvarna Forest and Garden Division had previously executed several strategic shifts, including discontinuing low-margin business lines and consolidating production structures to better align with market needs.

The partnership with Flex Ltd also brings employment opportunities, as current employees of the Orangeburg facility will be offered roles within Flex. This is a positive development in terms of job security and community relations, further demonstrating Husqvarna's commitment to its workforce during times of transition.

Moreover, the collaboration not only allows Husqvarna to maintain its product innovation and design—elements that have long been synonymous with the brand—but also focuses on enhancing customer service and product availability. With Flex at the helm of manufacturing, Husqvarna can streamline operations and respond more effectively to consumer demands, which is instrumental in a competitive market landscape.

Husqvarna's strategy moving forward is not merely about surviving in the current market; it's about thriving amidst complexities and challenges. As they continue to innovate and enhance their product offerings, the partnership with Flex Ltd is set to play a crucial role in shaping the future of Husqvarna in North America.

Through such strategic partnerships and operational decisions, Husqvarna aims to position itself as a front-runner in the outdoor power product industry, adhering to its legacy of quality and performance while adapting to changing market dynamics. This exciting phase heralds a promising future for Husqvarna Group, their employees, and their customers across North America.