Hermès saw slower sales growth at the start of the year because Chinese shoppers bought fewer luxury goods. Their sales in Asia Pacific, except Japan, only grew 1.2 percent, which missed what experts expected. The company that makes Birkin bags reported overall sales slightly below predictions. This rare letdown comes as fancy brands face weak growth with Chinese customers spending less on expensive items.
The luxury market looks even worse after Donald Trump put a 10 percent tax on European imports. Hermès plans to raise prices in America starting May 1 to deal with these new tariffs. Store traffic decreased in China partly because of problems in the housing market. The company also had to compare against strong sales from last year, which made current results seem weaker.
Hermès still performs better than competitors because it sells to very rich people who keep spending even when the economy struggles. As customers wait in line to buy their handbags, Hermès can charge high prices. The company limits production to make its products seem more special. Sales grew in all regions, with the Americas showing an 11 percent increase.
The luxury market looks even worse after Donald Trump put a 10 percent tax on European imports. Hermès plans to raise prices in America starting May 1 to deal with these new tariffs. Store traffic decreased in China partly because of problems in the housing market. The company also had to compare against strong sales from last year, which made current results seem weaker.
Hermès still performs better than competitors because it sells to very rich people who keep spending even when the economy struggles. As customers wait in line to buy their handbags, Hermès can charge high prices. The company limits production to make its products seem more special. Sales grew in all regions, with the Americas showing an 11 percent increase.
