As luxury brands bet on a strong rebound in Chinese demand following the relaxation of COVID-19 lockdowns, the top fashion brand of LVMH, Louis Vuitton, is anticipated to raise prices in China by as much as 20%.
The biggest luxury brand in the world, Louis Vuitton, raised prices in a series of other top brands in the industry last February.
High-end labels have been raising prices over the past few years to cope with rising costs and currency fluctuations. Hermes, the maker of the Birkin bag, has announced plans to increase prices by 5% to 10% this year. This is in response to the wave of soaring demand fuelled by consumers using savings from pandemic lockdowns.
On February 18, Louis Vuitton price increases of between 8% and 20% are predicted by bloggers on China’s social media platform Xiaohongshu. Discussion has focused on lines forming outside of stores in Shanghai, for example, which is seen as a sign that customers are trying to make purchases before any increase.
Users of the Xiaohongshu website, also known as Little Red Book in the industry, frequently cite sales representatives for the fashion labels and have a history of accurately forecasting price increases, but they don’t always give credit to their sources.
To close the price gap between the United States and Europe, LVMH executives hinted at modest price increases last month, primarily for leather goods.
“From time to time we have the possibility of doing it,” LVMH chief financial officer Jean-Jacques Guiony told reporters at a company results presentation last month, noting executives have a prudent approach to price hikes, and seek to avoid multiple increases.
According to the website PurseBop, Louis Vuitton increased prices in France this month by between 3% and 7% for its well-known Neverfull tote bag, which costs 1,500 euros ($1,609.35).
The luxury market tracking website cited models of the top handle Capucines bag that increased in price from 5,150 euros to 5,500 euros as well as a Pochette Accessoires purse that increased in price from 980 euros to 1,050 euros.
(Adapted from StraitsTimes.com)