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China Luxury Demand Recovery Unlikely Soon, Warns Bernstein Report
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Moneycontrol•17-10-2026, 11:58
China Luxury Demand Recovery Unlikely Soon, Warns Bernstein Report
- •A Bernstein report warns that China's luxury demand recovery may remain elusive, shifting from an expected U-shaped rebound to an L-shaped stagnation.
- •Global luxury brands are urged to revise growth expectations downward and focus more on affordability and value for money.
- •Economic pressures in China, including falling property prices, weak consumer confidence, and high youth unemployment, are weighing heavily on household wealth.
- •Without a strong revival in Chinese demand, overall industry growth could slow to around 4 percent or 5 percent annually, compared to past rates of up to 8 percent.
- •Rather than abandoning luxury entirely, Chinese consumers are trading down, prompting brands to offer more accessible products while protecting their premium image.
Key Questions Answered
A Bernstein report indicates that a prolonged economic slowdown, weak consumer confidence, falling property prices, elevated youth unemployment, and pressure on household wealth are weighing down Chinese consumer demand.
Analyst Luca Solca noted that the previously anticipated U-shaped recovery now looks much more like an L, prompting recommendations to revise down industry growth expectations for the coming years.
Brands are advised to focus more on affordability and value for money, offer more accessible products, and strengthen their value proposition without harming their premium positioning rather than just waiting for macroeconomic conditions to improve.
