MILANO, Aug 1 (Class Editori) – On June 30th, 2019, the Italian and European luxury companies managed to prove once and again that China keep being the El Dorado of high-end industries – a start countertrend when seen against the backdrop of the rest of the markets around the world, registering moderate or even negative growth rates. Two examples are, for sure, BMW – for automotive – and the fashion brand Ferragamo.
Despite the important slowdown registered in China's traditional automotive market, characterizing the first six months of 2019, BMW – realizing around one third of its total turnover in the People's Republic – sold 24 percent more than the year before, a further growth against that already denoting 2018. On the global level, the German company's sales increased by 2.9 percent only, accounting for 25.7 billion euros.
As for Ferragamo, the Chinese market makes up 40 percent of its total turnover, and generated a so-called high double digit growth – thus closer to 20 percent than to 10 percent,which was the company's stable average for the last few years. Such percentages seem to hold even higher significance because it can be seen against the backdrop of the general Asia-Pacific area, producing an 8 percent growth in its two main markets – Japan and South Korea.
On the other hand, the Italian brand is paying the consequences of both the tariff war and, on the local level, of the tourists passing through Hong Kong and Macao experiencing less appetite for shopping.
Regarding Chinese consumption, Ferragamo focused on young generation needs, in particular through its digital channel – slowly growing in importance. A few days back, two other big luxury brands (Moncler and Lvmh) confirmed experiencing a similar trend during the first six months of 2019 – that is, a double-digit growth in both sales and profits on the Asian markets.
"Profits have grown by 15 percent in Asia – pushed by China, Japan, and South Korea’s important contributions – working around the speed-up of constant exchange rates characterizing the second quarter," said Remo Ruffini, number one of Moncler. The manager informed that, during the first quarter, in the Asian region sales surpassed 249 million euros (against a total of 570 million), making up 43 percent of the brand's entire turnover.
As for BMW, as the automotive market fell by 15 percent, the company still registered a +15.5 percent thanks to 63,135 vehicles sold in the region – a record. Most of its positive performance was related to the full availability of its Series 5 and its X3, produced in Asia directly.
BMW expects that, by the end of this year, the number of electric vehicles on roads around the world sold by the group will amount to over half a million. Overall, sales of the BMW electric vehicles increased by 1.4 percent compared to January last year, to 7,234 units. The increase was achieved despite the limited availability of two key plug-in hybrid vehicles, due to the models renewal.
"The launch of the new 330e and the new X5 xDrive45e, by the end of the year, will support further sales growth of the electric vehicle range," the German car maker pointed out. The i3 is the electric car most sold. The launch, at the end of last year, of a more powerful battery has contributed to increasing deliveries in January to 2,598 units, 30.4 percent more than the same month of last year. The 530e was also an important growth driver, with deliveries up 82 percent to 1,722 units.
The result of the Chinese market is due to a strategy started in 2003 that led to the establishment of a joint venture – the BMW Brilliance Automotive – with a model plant in Shenyang, in the north east of China, a joint venture in which the BMW increased in October its share from 50 to 75 percent of the capital, simultaneously renewing the collaboration agreement for another 22 years, until 2040.
Together with the manufacturing, BMW developed three research centers, in Beijing, Shenyang and Shanghai, with hundreds of technicians at the forefront in experimenting new technologies, in the autonomous driving, in Level 2 test phase as early as 2014 on the streets of Shanghai, to electric vehicles – centers that are working for all the group.
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