Argentine companies replace manufacturing with importing — with huge profit margins

Several Argentine companies have changed their business model as they start to import the products they used to manufacture, a report by the Institute for Public Policy and Thought (IPyPP) said.  The investigation found that the shift in strategy implies mass layoffs and the sale of imported goods in Argentina “well above their import costs.” According to the report, the shift is seen across several sectors — “kitchenware, automobiles, household appliances, footwear, furniture, cell phones, food, and personal care products.”  “In all the cases examined, the same trend emerges: increased imports of finished goods, decreased local production, and a decline in industrial employment,” the report added. Less industrial production According to the IPyPP report, three umbrella policies, implemented since Javier Milei took office in December 2023, pushed companies to shift their strategies: tariff liberalization, currency appreciation, and contraction of the local market due to falling wages. According to INDEC, the government’s statistics institute, manufacturing industrial production declined 8.7% in February 2026, compared with the same month in 2025. A category containing computers, televisions, and communications devices dropped by 24.6%, leading the year-to-year decline. They were followed by automobiles and garments, which plummeted by 24% and 22.6% respectively. In addition, since November 2023, 100,000 jobs have been lost in the sector — 160 jobs per day, said a report by the Center for Studies on Argentine and Latin American Industry (Aesial) and the Center for Studies in Argentine and Latin American Economic History (Ceheal) at the University of Buenos Aires (UBA). The IPyPP report said that, since 2023, there has been a 44% increase in imported consumer goods and a 207% increase in imported vehicles. “These are not production inputs or capital goods, but rather final consumer goods,” Martín Schorr, an economist and one of the authors of the IPyPP report, told the Herald. And companies, he said, are taking advantage of the new situation. In 2025, for the first time, local company Lumilagro began importing branded thermoses from China: a total of 65,490 finished thermoses were imported, while in the first two months of 2026 alone, the company had already imported 40,626.  Easy, a home improvement retailer, imported furniture and home goods for US$10 million in 2023, while it did so for US$27 million in 2025. In January 2025, a subcontracted manufacturing plant working for the Adidas multinational, located in Coronel Suárez, Buenos Aires, announced its closure. This resulted in the layoff of 360 factory workers. In 2025, the company imported approximately 9 million pairs of shoes, compared to fewer than 2 million in 2023. But that doesn’t necessarily mean that consumers are getting their products at the import price. Lumilagro sells a thermos with an import cost of AR$8,178 for AR$44,000 before taxes: 5.4 times more. At Easy, a folding chair with an import cost of AR$4,230 is sold for AR$32,000: 7.6 times more. And Adidas sells a pair of sneakers with an import cost of around AR$26,790 for AR$100,000: 3.7 times more. The Herald contacted the three companies for comment. At press time, it received no response. The report said that the shift implied “the erosion of technological and productive capacities accumulated over many years and job losses in the industrial sector.”  For example, the report said, in November 2025, Whirlpool closed its plant in the Buenos Aires town of Pilar, which had opened in 2022.  “As a result, nearly 300 workers lost their jobs. However, this production shock did not halt the company’s commercial growth: imports of finished washing machines, refrigerators, and freezers continued to rise,” said the investigation.  In 2025, the company imported 67,000 washing machines, compared to 29,000 in 2023. As a result of the plant’s closure and its restructuring strategy, imports of parts and supplies for washing machine manufacturing fell from AR$16 million to virtually zero in the first months of 2026. “Deindustrialization during the first two years of Milei’s administration exceeds the trends observed during other neoliberal experiments, such as the 90s one peso=one dollar era or the [Mauricio] Macri administration [2015-2019],” said Schorr. “And large companies play a central role in this process,” he added.