Could Beijing’s Jump in COVID-19 Cases Set Roadblocks to Luxury Recovery?

As long as COVID-19 continues its global spread, no country will be immune from its devastating effects, even the market that Western luxury brands are betting on for luxury’s recovery. On June 15, Beijing reported 36 new cases, the highest number of daily infections in two months. The spike looks to have originated at Beijing’s Xinfadi wholesale food market, the biggest wholesale food market in Asia. Local Chinese media suspect links to seafood shipped from Europe but this has yet to be confirmed. No matter, the Chinese government has reacted quickly, enforcing neighborhoods around the massive market, which is roughly the size of 251 American football fields, to undergo rigorous checkups and strict restrictions controlling incoming and outgoing traffic. Neighborhoods in the west and southwest of Beijing are, at the moment, classified as medium-risk. However, mass testing is currently being conducted at local clinics and districts. Jing Take Prior to the new outbreak, Beijing was on its way to a strong recovery, with malls and stores filled with eager shoppers emerging from months of lockdown. Now, however, Beijing’s recovery appears less rosy, and the potential impact of Beijing once again in lockdown would have devastating effects for global luxury brands counting on Beijing’s recovery, as well as China’s overall economy and its rising domestic travel market. Already posts cancelling airline tickets to Beijing for the upcoming Dragon Boat Festival have emerged online. Added to that, multiple provinces have started to enforce a 14-day self-quarantine to those traveling from Beijing. Is this the start of China's second wave? The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.

Sectors

Insights

Company

Could Beijing’s Jump in COVID-19 Cases Set Roadblocks to Luxury Recovery?