Hong Kong protests put huge dent in Asia luxury goods sales

Protests in Hong Kong, an economic slowdown and anti-corruption drive in China and a coup in Thailand: Asia is no longer a market of constant growth for luxury goods firms.

LVMH, world leader in the sector and owner of brands like Louis Vuitton, Givenchy and Dior, saw its sales drop by 3 per cent in Asia, excluding Japan, in the third-quarter of 2014, a far cry from the halcyon days of 2010-2012.

In every other market, LVMH's sales increased, according to figures published last week. Even activity in sluggish Europe had done better over the past nine months, the group said.

Slowing economic growth on the mainland, and a clampdown on lavish spending by government officials, is crippling luxury goods firms that are used to viewing the growing pool of wealthy consumers in the world's No 2 economy as a cash cow.

Consultants Bain & Company have forecast that the luxury goods market in China will contract for the first time ever this year.

The crisis in Hong Kong "will have an impact" on the quarterly results, LVMH group finance director Jean-Jacques Guiony said. "We have already noted some negative impact on activity in duty free shops in the third-quarter," Guinoy said.