The Southeast Asian wood furniture industry, long considered a global powerhouse for affordable, high-quality furnishings, is navigating fresh challenges following the recent announcement of sweeping new U.S. tariffs.
The US remain the biggest market for Vietnam wood industry
Former President Donald Trump’s proposed 46% tariff on furniture imports from Vietnam has sent shockwaves through the region, threatening to reshape export markets, manufacturing strategies, and investment decisions.
Vietnam: A Giant Under Pressure
Vietnam, the world’s sixth-largest furniture producer, exported nearly $8.4 billion worth of wood and furniture products in 2024, with the U.S. accounting for a dominant share. The sudden tariff hike is causing unease among local manufacturers heavily dependent on the American market.
“Companies are scrambling to recalibrate export plans and diversify into alternative markets in Europe, East Asia, and Australia,” said a representative from the Vietnam Timber and Forest Product Association (VIFORES).
Despite these uncertainties, VIFA EXPO 2025 in March drew over 650 businesses seeking to fortify market presence and explore new partnerships, with sustainability, automation, and eco-friendly designs taking center stage.
Indonesia: Restructuring and Market Diversification
ndonesia, Southeast Asia’s second-largest wood furniture exporter, saw its overseas shipments dip from $2.5 billion in 2022 to $1.9 billion in 2023. The U.S. remains its biggest market, accounting for 53.6% of total exports in 2024.
In response to both the Trump tariff and broader market pressures, Indonesia is accelerating domestic reforms. The government announced a Rp7.5 billion ($480,000) machinery restructuring initiative aimed at enhancing manufacturing competitiveness and product quality. Simultaneously, new policies to ease regulations for furniture businesses are being rolled out to support market expansion and employment.
Moreover, Indonesia is tapping into its underutilized natural resources — particularly rattan, bamboo, and lesser-known hardwoods — to carve out a niche in sustainable and artisanal furniture markets.
Regional Shifts: ‘China Shock’ Adds to the Strain
Beyond U.S. tariffs, Southeast Asia faces rising competition from Chinese exporters targeting Global South markets. As China floods emerging economies with lower-cost products — including wood furniture — regional manufacturers in Thailand, Malaysia, and Indonesia report mounting pricing pressures and factory closures.
Reuters recently described the phenomenon as a “China Shock 2.0,” with economists warning of its disruptive impact on local industries, prompting governments to consider new industrial protection policies.
Technology and Innovation: An Emerging Counterweight
In the face of these headwinds, technology-driven innovations are offering a glimmer of hope. Recent launches at VietnamWood 2025 and IFMAC WOODMAC Jakarta 2025 spotlighted AI-enabled CNC machines, autonomous sanding robots, and computer vision-assisted fabrication tools — technologies poised to reduce production costs and improve product quality.
“These innovations are critical if Southeast Asian manufacturers want to stay competitive, either by reducing reliance on the U.S. market or by fending off low-cost Chinese imports,” noted a regional industry analyst.
While the Trump tariffs have introduced fresh uncertainty into Southeast Asia’s wood furniture sector, a combination of market diversification, regulatory reforms, and advanced manufacturing technologies could help the region weather the storm. How effectively each country adapts to these challenges will shape the region’s industrial fortunes in the years ahead.
multiple sources
The US remain the biggest market for Vietnam wood industry
Former President Donald Trump’s proposed 46% tariff on furniture imports from Vietnam has sent shockwaves through the region, threatening to reshape export markets, manufacturing strategies, and investment decisions.
Vietnam: A Giant Under Pressure
Vietnam, the world’s sixth-largest furniture producer, exported nearly $8.4 billion worth of wood and furniture products in 2024, with the U.S. accounting for a dominant share. The sudden tariff hike is causing unease among local manufacturers heavily dependent on the American market.
“Companies are scrambling to recalibrate export plans and diversify into alternative markets in Europe, East Asia, and Australia,” said a representative from the Vietnam Timber and Forest Product Association (VIFORES).
Despite these uncertainties, VIFA EXPO 2025 in March drew over 650 businesses seeking to fortify market presence and explore new partnerships, with sustainability, automation, and eco-friendly designs taking center stage.
Indonesia: Restructuring and Market Diversification
ndonesia, Southeast Asia’s second-largest wood furniture exporter, saw its overseas shipments dip from $2.5 billion in 2022 to $1.9 billion in 2023. The U.S. remains its biggest market, accounting for 53.6% of total exports in 2024.
In response to both the Trump tariff and broader market pressures, Indonesia is accelerating domestic reforms. The government announced a Rp7.5 billion ($480,000) machinery restructuring initiative aimed at enhancing manufacturing competitiveness and product quality. Simultaneously, new policies to ease regulations for furniture businesses are being rolled out to support market expansion and employment.
Moreover, Indonesia is tapping into its underutilized natural resources — particularly rattan, bamboo, and lesser-known hardwoods — to carve out a niche in sustainable and artisanal furniture markets.
Regional Shifts: ‘China Shock’ Adds to the Strain
Beyond U.S. tariffs, Southeast Asia faces rising competition from Chinese exporters targeting Global South markets. As China floods emerging economies with lower-cost products — including wood furniture — regional manufacturers in Thailand, Malaysia, and Indonesia report mounting pricing pressures and factory closures.
Reuters recently described the phenomenon as a “China Shock 2.0,” with economists warning of its disruptive impact on local industries, prompting governments to consider new industrial protection policies.
Technology and Innovation: An Emerging Counterweight
In the face of these headwinds, technology-driven innovations are offering a glimmer of hope. Recent launches at VietnamWood 2025 and IFMAC WOODMAC Jakarta 2025 spotlighted AI-enabled CNC machines, autonomous sanding robots, and computer vision-assisted fabrication tools — technologies poised to reduce production costs and improve product quality.
“These innovations are critical if Southeast Asian manufacturers want to stay competitive, either by reducing reliance on the U.S. market or by fending off low-cost Chinese imports,” noted a regional industry analyst.
While the Trump tariffs have introduced fresh uncertainty into Southeast Asia’s wood furniture sector, a combination of market diversification, regulatory reforms, and advanced manufacturing technologies could help the region weather the storm. How effectively each country adapts to these challenges will shape the region’s industrial fortunes in the years ahead.
multiple sources