BEIJING, February 28 (TMTPOST)—Shortly after the Chinese New Year’s Day in the Year of the Dragon, Louis Vuitton (LV) has recently announced another price increase in China.

Starting from February 19, LV will raise the prices of some products in China, with an average increase of around 6%. For instance, the Carryal small handbag will increase from 19,600 yuan to 20,600 yuan, and the Carryal medium handbag will go up from 20,500 yuan to 21,500 yuan. This comes just half a year after LV's last price hike in June, when the Carryal small handbag was priced at 16,500 yuan.

The 2023 financial report shows that the Asia-Pacific region is LVMH's largest regional market. The Asia-Pacific region, including China (excluding Japan), contributed the highest revenue of 26.707 billion euros, accounting for 31% of the group's revenue, a 1% increase from 2022. The US and Europe contributed 21.538 billion euros, accounting for 25% of the group's revenue. While the US's revenue share decreased by 2 percentage points, Europe's increased by one percentage point. Japan's revenue was 6.031 billion euros or 7% of its global revenues while revenues from the rest of the world accounted for 12%.

In June 2022, Bernard Arnault, the head of LVMH, visited the Chinese market for the frist time, sparking speculation about a price increase. From Wangfujing to SKP to China World Trade Center,  Arnault inspected retail stores of his brands in the core business districts. Following this, he visited Chengdu, inspecting stores in Chengdu IFS, Chengdu Taikoo Li, and Chengdu SKP.

In January, during a conference call after the release of LVMH's 2023 financial report, Jean-Jacques Guiony, LVMH's Chief Financial Officer, stated, "Although the Asian market has experienced double-digit growth over the past two years, the current situation in Asia has become more complicated. This is mainly due to a sluggish Chinese market in the second and third quarters of 2022, providing a low comparison base in 2023."

He also mentioned that Chinese consumers are returning to the world, but at present, these data have not fully recovered to previous levels. For example, compared to the fourth quarter of 2019, in the fourth quarter of 2023, the related data of Chinese consumers in France decreased by 30%.

Will the middle class continue to buy luxury goods despite the repeated price hikes? Although the 2023 fiscal year data met market expectations, LVMH's revenue growth in 2023 slowed significantly compared to the 23% growth in 2022.

In reality, luxury goods prices in the Chinese market are already considerably higher than those overseas. According to the "2023 China Luxury Goods Market Report," luxury handbags priced above 10,000 euros are 20% to 25% more expensive in China than in Europe.

(1 yuan equals $0.14; 1 euro equals $1.08)