Legrand trims projected tariff hit, eyes US manufacturing footprint in the long term

Legrand SA

31/07/2025 06:30

By Anna Peverieri

July 31 (Reuters) - French electrical and digital infrastructure group Legrand LEGD.PA has lowered its estimate of the financial impact from U.S. tariffs on Chinese imports, CEO Benoit Coquart said in an interview.

The company now expects tariffs to weigh on adjusted earnings before interest and tax by around $140 million to $180 million this year, down from a previous forecast of $150 million to $200 million made in May.

That earlier estimate was based on the assumption that the announced 145% U.S. tariff on Chinese goods would fall to 50–60% later in the year.

Legrand also confirmed the company's pricing strategy for products sourced from China, but now expects to raise prices by 2% at the group level this year, up from the previous forecast range of between 1% and 2%.

The group, which is shifting production from higher-tariff countries such as China to lower-tariff ones, has nearly halved its reliance on exports from China to the U.S. from the start of Donald Trump’s first term as U.S. president in 2017 to now, Coquart added.

Legrand said in May it was moving production, notably of  lower-value products such as switches and presence detectors, from China to Vietnam, India and Mexico.

While Legrand is gradually diversifying its supply chain toward countries less exposed to tariffs in the short term, it plans to increase manufacturing in the U.S. and reduce its footprint in China over the longer term, the group's CEO added.

The company is also leveraging the U.S.-Mexico-Canada Agreement trade framework to ensure tariff compliance and preserve margins.

Legrand on Thursday increased its annual operating margin outlook as it reported first-half core earnings above market expectations.

 (Reporting by Anna Peverieri in Gdansk
Editing by Matthew Lewis)

 ((Anna.Peverieri@thomsonreuters.com;))