SHANGHAI – LVMHs top fashion brand Louis Vuitton is expected to increase prices in China by as much as 20 per cent, as luxury labels bank on a strong rebound of Chinese demand following the easing of Covid-19 lockdowns.
Louis Vuitton, the worlds biggest luxury brand, last February led the way in a string of price hikes from some of the industrys biggest names.
Riding a wave of soaring demand fuelled by shoppers drawing on savings from pandemic lockdowns, high-end labels have been raising prices over the past few years, with Birkin bag maker Hermes flagging plans to hike prices by 5 per cent to 10 per cent in 2023, to cope with rising costs and currency fluctuations.
Bloggers on Chinas social media platform Xiaohongshu are forecasting price increases at Louis Vuitton of between 8 per cent and 20 per cent kicking in on Saturday, and chatter has focused on lines forming outside stores in Shanghai, for example, seen as a sign that shoppers are seeking to make purchases before any increase.
Users of the Xiaohongshu site, known in the industry as Little Red Book, often cite sales associates for the fashion labels and have a track record of correctly predicting price increases but do not always specify their sources.
LVMH executives in January signalled limited price hikes, mainly for leather goods, to reduce price gaps between the United States and Europe.
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 in January, noting that executives have a prudent approach to price hikes, and seek to avoid multiple increases.
Louis Vuitton, which sells a popular tote bag called Neverfull for 1,500 (S$2,100), raised prices in France by around 3 per cent to 7 per cent in February, according to website PurseBop.
The website, which tracks the luxury market, cited models of the top handle Capucines bag that went up to 5,500 from 5,150, and a Pochette Accessoires purse that rose to 1,050 from 980.
LVMH and Louis Vuitton did not immediately reply to a request for comment. REUTERS More On This Topic Chinas luxury shoppers free to travel, but many buy locally As travel resumes, China's luxury shoppers ask: Paris or Hainan?
