With most of the U.S. still registering a staggering number of deaths topping any other country in the world, the dramatic evolution on the pandemic in Brazil and the resurgence in China (Beijing) – are further severely impacting all the sectors of the global luxury industry, especially luxury fashion, luxury watches & jewellery and luxury cars.
We estimate a further decline of up to 15% for the first half of 2020, considering the worsening sentiment among Asian consumers, especially China, Thailand, Malaysia and Indonesia. Only brands which have a demonstrated investment relevance are likely to perform better (ex Hermes, Chanel, Louis Vuitton, Rolex, Patek Philippe)
In Beijing, in a span of less than a week, over 90% of luxury mono-brand stores are either closed or completely deserted, whether they are part of a shopping mall or brick & mortar street stores. Beijing is a key market not only for locals (both personal and gifting) but also wealthy from third / fourth tier cities domestic visitors. Online shopping including major platforms but also social media based such as WeChat are also negatively impacted in the past two weeks.
The luxury hotel sector is also likely to be hit while they had been registering a feeble rebound in China. The most exposed luxury hotel groups include Shangri-La , IHG and Hilton (luxury & upscale brands).
CPP-LUXURY.COM has been conducting a survey among the major international luxury brands with a presence in China (including mainland and Greater China) as well as South / Latin America, with a focus on key markets such as Brazil, Chile and Colombia.
Hermes store Guangzhou, China
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