Chinese consumers account for a third of global spending on luxury goods, the figure to reach 45 percent or more by 2025

[vi-va]

As @vi-va often trolls says:

"People are dying, 100's of millions are moving from extreme poverty to just abject poverty and you cheerleaders jump up and down for the DOW luxury spending. See a doctor, oh the humanity"

That's the down side of capitalism. I dislike luxury spending.

 

[letsrock]

This tells me that chinese economy is under valued. How is it possible that an economy only 2/3rd of usa economy buys twice (?) as many BMW/Merc/Audi etc.

 

[Hamartia Antidote]

This tells me that chinese economy is under valued. How is it possible that an economy only 2/3rd of usa economy buys twice (?) as many BMW/Merc/Audi etc.

Because they don't know the cars are endless money pits. They only know about prestige from media/movies.

Pretty much everybody in the US has had a relative or friend complain about their BMW/Mercedes since the 1980's.

 

[beijingwalker]

China's luxury market boomed this year, even as global sales shrank
https://edition.cnn.com/profiles/michelle-toh-profile
CNN Business

Updated 1112 GMT (1912 HKT) December 16, 2020


Hong Kong (CNN Business)China's luxury market has proved "unstoppable" this year even as the coronavirus pandemic hammered global demand for expensive goods.

That's according to a report released Wednesday by Alibaba's (BABA) TMall shopping platform and the consultancy Bain, which said the Chinese luxury market would grow by 48% this year to about 346 billion yuan ($52.9 billion) despite the pandemic.
The growth will almost double mainland China's overall share of the global industry from 11% last year to 20% in 2020, the firms said.

"Mainland China is the only major luxury market to grow in 2020," Bruno Lannes, a partner with Bain's consumer products and retail practices, told CNN Business. "China's luxury market is now bigger than ever."

But it's not all good news for luxury goods producers. The sales boom in China has been powered by consumers who would normally have spent big on luxury goods while on vacation abroad. Overall spending by Chinese consumers on luxury products is down around 35%, according to Bain and Alibaba.

"Mainland China's portion of Chinese global luxury purchases this year reached a peak," the report said. "[But] the growth in mainland China does not compensate for the Chinese consumption lost overseas."

Bain and Alibaba project that the global luxury market will shrink by 23% in 2020, as the pandemic continues to limit travel and shopping in many places.

A changing market
China rapidly suppressed early coronavirus outbreaks, allowing its economy to return to growth. By April, consumers in the country were starting to snap up expensive handbags, shoes and jewelry again, giving retailers some hope as sales in other markets faltered.

Travel restrictions helped boost sales in China. Another factor behind the surge has been dubbed "revenge spending," or a release of pent-up demand as people emerged from weeks of lockdowns. The trend helped create an uptick in sales this spring for several companies, such as Tiffany (TIF) and Burberry (BBRYF).

Government incentives have also helped. Earlier this year, Chinese authorities distributed coupons to help encourage people to shop, according to state media. That, too, has boosted luxury consumption, Bain and Alibaba said Wednesday.

Retailers have taken note of the changing market dynamics.

LVMH (LVMHF), the world's biggest luxury group, pointed to "great strength of the demand coming from mainland China" in an October earnings call.

"From a demand viewpoint, we have no particular worry, and we are very pleased with the response," said Chief Financial Officer Jean-Jacques Guiony. "But for the time being, there are serious constraints as to [customers'] ability to shop outside China, and this is obviously a weight on the growth for coming quarters."

The pandemic has also accelerated several long-term trends.

Even before the outbreak, mainland Chinese shoppers were spending money closer to home as they avoided hubs such as Hong Kong due to mass protests, and as brands reduced the price gap that had typically made their products cheaper outside China.


And as with other sectors, the crisis encouraged more people to shop online.

The habit will likely stick. Nearly 40% of Chinese consumers plan to do more luxury shopping online over the next few years, while another 40% expected to maintain their current activity, according to Bain and Alibaba.

"We believe Chinese luxury consumers' online shopping behavior has permanently changed," the firms wrote.

Next year, China's growth is expected to continue, albeit not at the same pace. Most brands believe the market will expand by roughly 30% as international borders start to reopen, according to the report. Over the next five years, the share of domestic spending will likely also "subside" as things gradually return to normal, it said.

But the Chinese market will have boomed in the meantime. In five years, China is expected to become the world's biggest luxury market — even after the world "returns to pre-Covid-19 levels," Bain consultants wrote.

China's luxury market boomed this year, even as global sales shrank

China's luxury market has proved "unstoppable" this year even as the coronavirus pandemic hammered global demand for expensive goods.

edition.cnn.com

 

[vi-va]

Should NOT buy those luxury.

 

[313ghazi]

1. This is a reflection on how the Western culture is dominant even in China. People are buying pointless expensive goods as status symbols. Its the western culture of greed which has poisoned everyone.

2. It is a reflection of the economic failure of the Western world. Wealth is so highly concentrated amongst the 1%, the rest will struggle to maintain thier standards of living, let alone buy luxury goods.

 

[zectech]

Should NOT buy those luxury.

Jewelry and works of craftsmanship and art are what they should buy. And Chinese made. There are many CGTN documentaries showing Chinese craftsmen. They should be buying up Chinese made works of art and Chinese made jewelry.

There is no point to overpriced rolex watches and handbags and other wastes of money. The rich of China got rich off of the labours of Chinese workers who are still poor. To buy up foreign crapola is a disservice to China and the Chinese.

Don't buy luxury goods that wear (cloths, shoes and purses, etc), buy antiques and modern artwork and Chinese made jewelry that support Chinese workers.

Chinese made silverware is what every rich person should have. Silver flatware is the possession of wealthy. That is a status item you can pass onto your kids. Luxury items should be few, and important.

 

[mike2000 is back]

Jewelry and works of craftsmanship and art are what they should buy. And Chinese made. There are many CGTN documentaries showing Chinese craftsmen. They should be buying up Chinese made works of art and Chinese made jewelry.

There is no point to overpriced rolex watches and handbags and other wastes of money. The rich of China got rich off of the labours of Chinese workers who are still poor. To buy up foreign crapola is a disservice to China and the Chinese.

Don't buy luxury goods that wear (cloths, shoes and purses, etc), buy antiques and modern artwork and Chinese made jewelry that support Chinese workers.

Chinese made silverware is what every rich person should have. Silver flatware is the possession of wealthy. That is a status item you can pass onto your kids. Luxury items should be few, and important.

What you are saying is not realistic. You think that the average person cares about the so called poor ? The average person thinks about themsleves and their family at MOST. So this talk of : Rich Chinese should consume Chinese products to help Chinese industries etc " is just laughable. It's not realistic and won't be happening anytime soon.
Moreover, these people will spend their money as they wish, since for then they made it themselves, so they don't owe anybody anything and also the fact that western luxury products have a higher brand value attach to them than Chinese ones. So the super rich will go for these western luxury products to show off their wealth and lifestyle. It's normal and happens around the world in almost every developing country and even some developed ones

 

[Hakikat ve Hikmet]

And, the top US companies are gonna miss that!?!? Biden is gonna make a reasonable peace with China.....

 

[siegecrossbow]

I don’t see how this is good. Just means a lot of nouveau riche show offs getting ripped off.

 

[rott]

I hate people who are obsessed with luxury brands. Totally fake and pretentious people with zero soul.

These Chinese people are fucking idiots to be spending so much money on foreign luxury brands, I'd have more respect for them if they were the ones creating luxury brands and marques.

I so agree with you on this.

 

[beijingwalker]

By 2027, we estimate that 1.2 billion Chinese will be in the middle class, making up one quarter of the world total. China already makes up the largest middle-class consumption market segment in the world and is a priority market for major multinational firms.

https://www.brookings.edu/wp-content/uploads/2020/10/FP_20201012_china_middle_class_kharas_dooley.pdf

 

[dbc]

Cuz US consumers are BROKE.

China remains the third-largest market for luxury goods with $52 billion in sales, behind The Americas with $74 billion and Europe with $68 billion.

China Is Headed To Be The World’s Largest Luxury Market By 2025, But American Brands May Miss Out

American brands are losing traction in China, soon to be the world's largest market for luxury.

www.forbes.com

 

[Viet]

Dumb young consumers, old Chinese generations are well known in the world for being extremely frugal.

View attachment 687320
View attachment 687321

Buying something you don’t need to impress people you don’t know.
It’s Ok to spend 50k euros on BMW or Audi but what’s the point to buy useless 2k euros hand bag?

 

[GiantPanda]

Buying something you don’t need to impress people you don’t know.
It’s Ok to spend 50k euros on BMW or Audi but what’s the point to buy useless 2k euros hand bag?

Surplus wealth. You only buy useless 2k euros hand bag once your necessities are taken care of several times over.

The shear numbers of cars and luxury goods sales are clear signs that China has the world's largest consumer class. Add to the fact that China consumes half the world's steel and half its cement, then it is pretty clear who is the largest economy in the world.