French luxury house Chanel has increased prices for a second time this year, it said on Friday, as high-end brands seek to protect margins from the fallout of the coronavirus pandemic. In a statement responding to a Reuters query, Chanel said the latest price increases were “the consequence of recent significant exchange rate fluctuations between the euro and certain local currencies”, without giving further details. “These adjustments are made in all the countries where it is necessary and are the guarantee that Chanel items are sold at equivalent price levels throughout the world,” it said, adding this was particularly important at a time when international travel is very limited. Chanel in May raised the prices of handbags and other small leather goods worldwide by between 5 per cent and 17 per cent. Flavio Cereda, an analyst at Jefferies, said that had been followed by another increase of around 5 per cent in October, notably in China, Hong Kong, Japan, South Korea and Britain. He expected other luxury brands to follow suit to compensate for the pandemic’s hit to 2020 margins. Luxury conglomerate LVMH’s star brands Louis Vuitton and Dior, luxury group Kering’s Gucci, Prada and Ferragamo among others have also increased prices this year. Boring and overpriced: in China, US luxury fashion has an image problem Brands say they have reduced the gap between their prices in Asia and the rest of the world, although analysts estimate the same item often costs as much as 30 per cent more in the key Chinese market than it does in Europe. According to Luca Solca, senior research analyst, global luxury goods at equity broker Bernstein, Chanel risks alienating customers in the West with these frequent price increases. Chanel may be raising prices for its status-symbol bags, which make up the lion’s share of sales in the label’s fashion division, but the same cannot be said for lower-margin items like clothing. Back in June, the brand held a sale of its ready-to-wear collections at its Hong Kong boutique in Landmark Prince’s building, a luxury enclave in the city’s Central business district where many notable international brands have their flagship stores. Fashion insiders circulated pictures and videos of Chanel cardigans, dresses and other heavily discounted out-of-season items strewn around shelves jumble-sale-style on social media. While it is common for top brands to discount trendy and seasonal items like apparel, Chanel is extremely protective of its image – the label has been involved in a series of lawsuits against resellers of its luxury bags such as The Real Real – which is why the summer sale at its Hong Kong flagship store raised eyebrows in fashion circles.