Hermes will sell its bags and scarves at a higher price in the United States more than other parts of the world in response to President Donald Trump’s definitions.
The French company, which has long resisted the slowdown in the sector and has become the most valuable luxury company before LVMH Earlier this weekShe said she plans to pass the additional costs of customs tariffs to her wealthy clients.
This will be applied in addition to the high-planned high prices of Hermès by 6-7 % this year. The cost of its bags comfortably more than $ 10,000, with its rare rise For more than 85,000 dollars.
“We will completely compensate for the impact of these new duties by increasing the selling prices in the United States as of May 1, through all our business lines,” Eric de Halaoho said in an interview with reporters on Thursday. Reuters mentioned.
Hermes warned that he might do this during its annual results In FebruaryBecause moving production is not possible.
“We are very associated with our production where he is,” said CEO Axel Dumas, said, According to Bloomberg.
Birkin and Kelly Bag-Maker shared pricing plans along with the results of the first quarter on Thursday. I mentioned 4.1 billion euros in sales, an increase of 7 % in The first three months of the year (In the conditions of fixed exchange rate) compared to the same period in 2024.
These numbers are less than analysts’ expectations due to the most softened demand in China and the low revenue in its business parts that attract more ambitious shoppers, including perfumes and watches.
“In the complex geopolitical and economic context, the house enhances its basics more than ever,” Dumas said in a statement.
However, Hermes’s strength, which remains with her wealthy customers, helped her business growth in every geography. Looking at the company’s highest group of shoppers, it is still relatively protected from the impact of definitions on the feeling of the wider consumer.
“We expect the group to benefit from the outstanding prices for its peers,” said James Grizzinik’s James Ownership.
Trump slapped a 10 % tariff on imports from all over the world this month after delaying 20 % higher duties and above in the European Union. Many luxury providers lack manufacturing in the United States, including KERING owner Gucci, and they appreciate that they were “made in France” or “made in Italy”. This leaves companies that have small options that exceed the increase in prices to customers.
In theory, due to the relatively price base for shoppers and the desire related to goods, demand for all things does not respond significantly to price increases. But walking for long distances is uncompromising In recent years Against the background of economic pressure has already disturbed the appetite of many shoppers, which contributed to the slowdown of the luxury sector.
Estimates indicate that prices are now 61 % higher than 2019, and any growth brands Incurred It also decreased to the price instead of size.
“Many growth driving engines in the industry have stopped. The price increases have reached a ceiling, and higher prices negatively affect the demand from the ambitious consumers.”
The global ranking in which we live can be forced brands on the corner: either the prices of shoppers to pay or find a way to make manufacturing at American work.
Therefore, although Hermes may be the first luxury giant to start high prices, he will certainly not be the last.
The actors in Hermes are no longer immediately luckRequest to comment.
This story was originally shown on Fortune.com
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2025-04-17 11:29:00
