Hermes to raise US prices after Trump’s tariff

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The French group said on Thursday that Hermes would change the burden of Donald Trump’s tariff to shoppers in the form of American prices higher for its luxury goods.

Financial Director Eric Du Halauta said that the maker of Birkin and Kelly bags “may compensate for the grave effect” for a 10 percent new imposition on European imports by raising prices from May 1 in the United States, as it reported a quarterly results.

This added Hermes He will continue to do this “through the work departments” in order to deal with changes in American commercial policy, although he said that the group still calculates the exact level that prices should rise.

His comments come as a luxurious industry Disorship brackets From Trump’s trade war on the market for advanced goods, with a tariff that destroyed the hopes of recovery from the United States this year.

Hermès is expected to use its location as one of the most flexible luxury industry names to bear commercial disorders, betting on the base of its wealthy customers and high demand for its bags that exceed the offer.

“While we look at a very uncertain future … we expect the group to benefit from the high pricing force against its peers,” James Grezzelk said in Jeffrez.

Trump is the same Definitions In the United States, commercial partners announced this month several analysts to reduce their expectations for a luxury sector in the second half of the year.

The most softened growth in China weighing the total sales in Hermes in the first quarter, leaving the growth of revenue with a little less than the expectations after 2024 powerful surpassing the rest of the industry.

The group listed in Paris, Who is now competing with LVMH To be the largest company for the luxury sector by market value, and the growth of organic revenues was 7 percent on an annual basis in the first quarter to become a total of 4.1 billion euros, less than 8.8 percent of growth analysts.

The result was a slowdown in the 18 percent growth mentioned by the group in the previous quarter, as the decline in China reached sales. Hermes stood up to this slowdown better than competitors last year.

The company said that sales in Asia outside Japan have grown by 1 percent “despite the basis of high comparison in particular” and the decline in Chinese demand during the past year. The shares fell 3 percent in morning trading on Thursday.

The luxury industry has struggled in the wake of a breakthrough in the Covid-19 pandemic as consumers of the middle class have been affected by spending, and the Chinese economy stumbled, which are now exacerbated by Trump’s aggressive trade war.

“The companies of difficult companies in China weigh greatly – they must improve with our progress in the year (while) in the mix category that confirms a slower environment than the demand for consumer,” wrote Luka Solka, an analyst at Bernstein.

Sales in Hermes have advanced in each region, with the Americas rise by 11 percent, with a “strong and continuous momentum” in March. Europe, France and Japan were all double numbers in the quarter.

The Group’s basic commodities section grew 10 percent. Fashion, jewelry, and the distinctive silk scarves of the group have grown compared to the previous year.

However, perfumes and beauty, which is a more exposed part to ambitious shoppers due to its low price, was flat, while the hours decreased by 10 percent.