On April 9, Donald Trump reeled in his attack on the global trade system, ordering a ninety-day pause on the steep “reciprocal tariffs” announced one week prior. Targeting many of the United States’ leading trading partners, the so-called “liberation day” tariffs threw financial markets into mayhem and was the object of rare criticism from right-wing billionaires and congressional Republicans alike. Stock markets recovered a major chunk of their losses following Trump’s apparent retreat, as corporate boards and fund managers breathe a temporary sigh of collective relief.
Not the least of them was the luxury goods industry. If Trumponomics has long been about reshuffling the decks between “losers” and “winners,” then the US administration’s salvo against globalization seems to bode particularly poorly for the world of luxury.
Intimately embedded in global trade flows, the luxury sector is dominated by a handful of European conglomerates that make a significant share of revenues from sales in the United States and abroad. France’s Moët Hennessy Louis Vuitton (LVMH), the largest holding in the sector, drew roughly a quarter of its 2024 revenue from the United States alone. LVMH, alongside its competitor groups Kering and Hermès, have been among the leading losers in the post–“Liberation Day” rout on France’s CAC 40 stock index. In just the last month, LVMH and Kering are down some 19 and 23 percent, respectively, compared to a roughly 10 percent falloff for the French stock index.
Even before Trump’s latest tariff escalation, the luxury industry was struggling to recover from a dip in spending, as high-end consumers cooled off from the wave of purchasing seen during the COVID-19 pandemic. Having previously…
Auteur: Harrison Stetler
