Customs duties: Luxury manufacturers worry about their profit margins
As Pierre-François Le Louët, co-president of the French Union of Fashion and Clothing Industries (UFIMH), pointed out, "The United States is a very large market that luxury goods manufacturers and high-end ready-to-wear brands cannot do without." The country alone accounts for around €80 billion of the €363 billion in global luxury goods revenue. France exported nearly 8% of its women's ready-to-wear, 13% of its handbag production, and an equal share of cosmetics to the US in 2024.
The US remains the top priority for French manufacturers, who are facing a global slowdown in the market. Sales of ready-to-wear, cosmetics, and perfumes could fall by 2% to 5% in 2025, according to forecasts from consulting firm Bain & Company published in June.
The sector is counting on US sales specifically to offset slowing consumption in China. In 2024, activity there dropped by roughly 20%, according to Bain & Company, and the start of 2025 has shown few encouraging signs. Tourists have deserted Hainan Island, a territory known for its shopping centers specializing in duty-free goods.
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