Dior and Lanvin see no downturn in China

Christian Dior, Spring Summer 2013

French luxury fashion maison Christian Dior sees no sign of a slowdown in China, and trends in Europe and the United States remain positive, its CEO said on Friday. The upbeat comments from the biggest fashion brand within the LVMH portfolio, followed a buoyant trading update on Monday from Prada COE Patrizio Bertelli, who said Chinese demand remained strong and warned about “hysteria” over a downturn in demand for luxury goods.

French luxury fashion brand Lanvin also said it was not seeing any weakness in Chinese demand, contrasting with rivals Burberry and Tiffany, which warned about a slump in recent months, suggesting the global luxury market might be entering a slower growth phase.

“We don’t feel a slowdown in China,” Christian Dior CEO and Chairman Sidney Toledano told Reuters after a presentation of the brand’s spring/summer 2013 collection. China, the luxury market’s main engine of growth in the past five years, has seen demand become more sluggish for certain luxury goods, due to slower economic growth.

Toledano said Chinese customers were becoming increasingly sophisticated. He said Dior had purposefully positioned itself in China at the very high end of the luxury market, offering bags in exotic leathers, organising haute couture shows, showing fine Dior jewellery and offering VIP rooms in boutiques. “I am not an economist, but looking at the fundamentals of demand in China, I am not worried,” Toledano said.  Outside China, Toledano said Dior was holding up well. “Trends are good even in Europe, where thankfully there are tourists” to drive demand, he said.

Lanvin CEO Thierry Andretta said the fashion brand would continue to have “double-digit sales growth this year.” Sales in Europe had slowed somewhat but not in directly operated stores.  “We will have another good year,” he told Reuters after the brand’s fashion show.