Crisis-proof: Booming luxury goods market

Inflation, price increases, shortages, crisis, war, climate change, recession, falling sales, worries about the future, refraining from buying, saving money for dark days: all these do not apply to the producers of luxury goods and their customers.

Both in Europe and in the USA, companies such as LVMH, Kering, Hermès or Prada recorded an increase in profits of up to 30 percent, writes the German "Spiegel". The increase in prices apparently did not affect their customers at all. The rich are simply less sensitive to inflation and existential fears.

Thus, in the first half of 2022, Prada increased its sales in Europe by as much as 89 percent. The French clothing manufacturer Moncler increased its turnover by 49 percent. Overseas tourists and the fall in the value of the euro also have an effect on this. Goods produced in Europe have become more affordable due to the weak euro, and exports are paid for with a strong dollar

American buyers in particular, who are benefiting from a strong dollar, flocked to luxury products. "In Europe, we sell four times more goods to American citizens than last year," says Kering CFO Jean-Marc Duple. Gucci, Yves Saint Laurent and Balenciaga are doing particularly well, Spiegel reports.

According to an analysis by the British bank HSBC from July of this year, only 15 percent of luxury goods produced in Europe are currently sold in the Eurozone. The French group LVMH, the leader among luxury goods concerns, can thank a quarter of the 28 percent increase in turnover in the first half of the year to the effects of the currency market.

The increase in the prices of raw materials, including final products, proved to be irrelevant for buyers of luxury goods.

In the midst of general market uncertainty, manufacturers of luxury goods look to the future with optimism, writes "Spiegel". In June, Kering announced that they wanted to double Yves Saint Laurent's sales to five billion euros a year. And Ferrari plans to increase its turnover to 2026 billion euros by 6,7, which would be an increase of 40 percent compared to the expected turnover by the end of the current year.

JH/Spiegel

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