China News Brief
    February 06, 2024

    Loewe to mount exhibition, Hollister opens new stores in Shanghai, Estée Lauder restructures.
    Thousands of jobs are set to go at Estée Lauder. Photo: Shutterstock

    Loewe to mount exhibition in Shanghai#

    Loewe plans to hold an exhibition , titled “Crafted World,” in Shanghai this spring, celebrating the brand’s Spanish heritage and culture. Curated by Loewe’s creative director, Jonathan Anderson, the 45-day exposition will take place at the Shanghai Exhibition Centre, offering visitors an immersive experience into the brand’s history, craftsmanship, and cultural collaborations. The exhibition will cover 178 years of Loewe’s evolution, from its origins as a leather-making collective in Madrid to becoming a leading luxury fashion house under the ownership of LVMH.

    Hollister opens new stores in Shanghai#

    At the end of January, Hollister opened  two new stores, at Shanghai Global Harbor and Century Link. Hollister entered the Chinese market officially in 2012, around the same time as its American counterpart, Gap. However, currently, Hollister has only 15 stores in mainland China. In comparison, Zara and H&M have already exceeded 100 stores, and even COS, which entered China later under the H&M Group, has 38 stores.

    Alexander McQueen unveils CNY collection#

    Alexander McQueen has unveiled  its 2024 Chinese New Year special collection, featuring a dragon print inspired by the distinctive shape of the Dragon’s Mouth flower. The accessories in the collection are presented in bright red and pink. Additionally, an animated video short film for this collection has also been released. The camera follows the petals of the Dragon’s Mouth flower as it explores three major Chinese cities: Beijing, Shanghai, and Chengdu.

    China clothing exports dip vs 2022#

    China’s clothing exports in 2023 amounted  to $159.14 billion, down 7.8 percent YoY compared to 2022, but up 8.5 percent increase compared to 2019. The year saw fluctuations in monthly exports, with significant declines in January and February due to the Spring Festival and a high base year. March and April showed double-digit growth as businesses resumed operations and backlogged goods were shipped. Exports continued to decline from May to October due to weak international demand. However, November and December saw a narrowing of the export decline, driven by cross-border e-commerce during the holiday season.

    Estée Lauder to ax thousands of jobs#

    Estée Lauder is cutting  up to 3,000 jobs as part of a restructuring plan aimed at revitalizing the beauty giant. The move aims to make the company leaner and more agile in responding to beauty trends driven by social media. Estée Lauder expects restructuring and related charges between $500 million and $700 million before taxes, with the job cuts and restructuring projected to yield an incremental operating profit of $1.1 billion to $1.4 billion. This comes as the company seeks to regain market share lost to rivals due to delayed responses to industry trends. Estée Lauder’s sales and profits have been impacted by declining sales at duty-free shops, especially in Asia, largely due to the pandemic and slower-than-expected economic growth in China.

    Record Spring Festival travel flow forecast#

    According to the China National Immigration Administration’s predictions , during this year’s Spring Festival holiday, the country’s ports will experience a new peak in inbound and outbound passenger flow, with an average daily clearance of approximately 1.8 million people. This would be a 3.3-fold increase compared to the previous year’s Spring Festival and is equivalent to the inbound and outbound flow during the 2019 Spring Festival. The major international airport ports are expected to have peak passenger flows from February 8 to 11 and February 16 to 17.

    Shein under fire for selling copycat items#

    Online retailer Shein faces  accusations of breaching its legal settlements by continuing to sell copycat items despite promising to stop, leading one of the world’s largest fashion groups to brand them “repeat counterfeiters.” Shein, valued at over $60 billion, is planning one of the most significant and controversial US initial public offerings (IPOs) in years. It has been hit with nearly 100 copyright cases. The company’s IPO faces intense scrutiny from lawmakers and regulators, who have raised concerns about forced labor in its supply chain and its use of import tax loopholes.

    Alibaba mulls sale of assets#

    Alibaba Group is considering  the sale of several consumer sector assets, including grocery business Freshippo, retailer RT-Mart, and shopping mall operator Intime, as part of a shift toward focusing on its core e-commerce business and divesting non-core, loss-making units. Discussions with strategic and financial investors are underway, but the talks are in the early stages, and Alibaba may choose not to proceed with the divestments. The move is in line with Alibaba’s broader restructuring and comes amid China’s tightened scrutiny of initial public offerings.

    Columbia posts thin sales growth#

    Columbia released  its full-year 2023 financial report on February 2. Net sales increased only slightly by 1 percent YoY to $3.49 billion, while net income decreased 19 percent to $251.4 million. However, its gross profit margin increased by 20 basis points to reach 49.6 percent. Looking at different regions, international markets, including China, remained a bright spot. Columbia’s chairman, president, and CEO, Tim Boyle, stated that the company achieved growth outside of the US, driven by direct sales markets in China and Europe.

    Ferrari share price roars on stellar sales#

    Ferrari’s stock surged  following Q4 sales results that exceeded expectations, and the company anticipates strong momentum in 2024, with China’s luxury demand playing a key role. Despite slightly missing profit estimates, Ferrari achieved a record-breaking 34 percent growth in net profit for the year, bolstering investor confidence. Additionally, the potential signing of Formula 1 champion Lewis Hamilton for Ferrari’s racing team in 2025 has garnered significant attention.