Reports

    China News Brief
    June 20, 2024

    Beijing considers consumption tax reform; Beiersdorf CEO acknowledges challenging times for La Prairie in China.
    People line up to buy the newly launched iPhone 15 and other Apple products at a flagship store, on September 22, 2023 in Beijing, China. Image: Getty Images

    Beijing considers consumption tax reform #

    China may be considering a reform of consumption taxes  as the Communist Party prepares for a key meeting next month, according to Goldman Sachs. Potential changes include broadening the tax base, increasing rates, collecting tax at the point of sale by wholesalers or retailers, and sharing revenue with local governments. These reforms aim to create sustainable income sources for local governments facing financial strain due to a prolonged housing slump. Additionally, simplifying the value-added tax system and introducing a nationwide property tax are under discussion. Currently, China’s consumption tax, which raised 1.6 trillion RMB ($224 billion) last year, is levied on tobacco, refined oil, automobiles, and alcohol, with all revenue going to the central government.

    Beiersdorf CEO acknowledges challenging times for La Prairie in China#

    German skincare company Beiersdorf stated that although it has successfully gained more market share with its brand La Prairie , the brand’s market in China will continue to decline in the second quarter of this year. Beiersdorf CEO Vincent Warnery mentioned that the company is currently unable to achieve growth, and both the first and second quarters of this year have been very challenging.

    Moncler Genius to unveil collaborations at Shanghai Fashion Week#

    Moncler Genius  is decamping to Shanghai in October. The brand said yesterday that it has earmarked October 19 to unveil its next round of collaborations, securing a slot at Shanghai Fashion Week, which kicks off on October 9. Describing the Chinese city and showcase as “the natural scene for an extraordinary celebration of ideas,” Moncler Genius was billed as “a pioneering platform for creativity, reshaping the traditional collaboration model.”

    China’s NEV demand seen surging, driving charging infrastructure expansion#

    Chinese consumer demand for new energy vehicles  (NEVs) is expected to continue its rapid growth, necessitating expanded electric vehicle charging infrastructure, according to the National Development and Reform Commission. The fast development of NEVs in China respects market competition and aims to drive the transformation of the auto industry, as stated by Li Chao on June 18, the commission’s spokesperson.

    Lanvin Lab collaborates with artist Erwin Wurm for Shanghai exhibition#

    On June 17, fashion house Lanvin held a ceremony at the Fosun Art Center in Shanghai to celebrate the official opening  of Erwin Wurm’s solo exhibition “Sleepwalker.” This past April, Lanvin announced its second collaboration with the renowned artist through Lanvin Lab, focusing on experimental creations that express culture and lifestyle. The Lanvin Lab by Erwin Wurm sculpture installations have previously been showcased in Beijing, Shanghai, and Nanjing. Returning to Shanghai, they are now featured at the Fosun Art Center alongside other works by Erwin Wurm in his solo exhibition.

    Versace opens pop-up Boutique at Shanghai’s Plaza 66 #

    The new Versace pop-up boutique  at Shanghai’s Plaza 66 features the brand’s classic design elements and seasonal women’s and men’s collections. Adhering to Versace’s aesthetic, the boutique combines light-colored walls with glossy black and polished metal decor, embodying Italian luxury and craftsmanship. The terrazzo floor, with white and pink rhinestone patterns, evokes the Palazzo Versace. Open from June 8 to August 6 on the B1 level of Plaza 66, it offers a full range of Versace’s seasonal ready-to-wear, handbags, shoes, and accessories.

    Isabel Marant reopens flagship in Beijing#

    French fashion brand Isabel Marant has reopened its 170-square-meter flagship store  in Beijing’s Sanlitun Taikoo Li South district. Inspired by the 1960s French experimentalist movement, the store emphasizes self-expression, imagination, durability, and experimentation, with organic shapes and warm tones creating a cozy atmosphere. Isabel Marant, expanding internationally, now has over 85 stores worldwide, including 16 in China.

    Swire Properties to participate in Shenzhen’s commercial district #

    On June 18, Swire Properties announced the signing of a cooperation agreement  with the Shenzhen Municipal Government. According to the agreement, Swire Properties will leverage its high-end commercial brands, such as Taikoo Li and Taikoo Hui, to participate in the construction of world-class commercial districts in Shenzhen. The company will actively expand its hotel business in Shenzhen, strengthen cooperation with Shenzhen’s passenger and logistics services, and assist in building Shenzhen into a high-quality international transportation hub.

    China’s wearable market growth outpaces global trend in Q1#

    According to IDC’s latest China Wearable Device Market Quarterly Tracking Report, the year-on-year growth rate of China’s wearable market  in the first quarter was four times that of the global market. In the first quarter of 2024, China and the global wearable device markets shipped 33.67 million and 110 million units, respectively, with year-on-year growth rates of 36.2% and 8.8%. Despite the global wearable market’s growth trend, the average selling price has declined for the fifth consecutive quarter due to the activity in emerging markets and the downward pressure of the economy on consumer spending.

    World Brand Lab unveils 2024 China’s 500 most valuable brands#

    The 21st World Brand Summit took place yesterday in Beijing, where World Brand Lab unveiled the 2024 China’s 500 Most Valuable Brands  report. This annual report, which considers financial data, brand strength, and consumer behavior analysis, revealed that State Grid secured the top spot on the list with a brand value of 653.89 billion RMB ($91.54 billion). Joining State Grid in the top five were Industrial and Commercial Bank of China, Haier, PetroChina, and China Life, all of which have achieved world-class brand status.

    Apple halts development of high-end MR headset#

    Apple has informed upstream suppliers to halt the development of the next-generation high-end MR headset Vision Pro . Initially, Apple planned to release both standard and Pro versions, similar to the iPhone strategy. However, the focus has now shifted to launching a cheaper, lighter version by the end of 2025, retaining the high-end display, but reducing the number of cameras, simplifying the headband, and using smaller speakers. The initial Vision Pro has seen poor demand, leading some component suppliers to significantly cut production after receiving Apple’s forecast.

    L’Occitane Group updates privatization offer#

    L’Occitane Group announced today in a stock exchange filing that it has updated its privatization  acquisition offer, providing minority shareholders with two options. Minority shareholders can choose a cash acquisition offer of $4.35 per share, or exchange their existing shares for 10 shares in the new privatized company.

    Shein enters South Korean market#

    Chinese online fashion retailer Shein announced today that it had officially entered the South Korean market , and actress Kim Yoo-jung will endorse its brand Dazy. Shein’s official Korean website was launched at the end of April.