Market Intelligence: Europe’s 30% ‘competitiveness gap’
We published a new version of our Market Intelligence newsletter on June 9.
This time, our report confirms that market conditions remain sluggish. There is demand for leather of specific qualities and for particular end uses, but much of the market remains under pressure.
Market Intelligence observes that consumers’ willingness to accept higher prices solely out of brand loyalty is being pushed to the limit, especially in China, a key market for all the major luxury brands. “It means that luxury must be justified differently,” the report explains.
Elsewhere, it says the European industry faces a widening competitiveness gap with Asian leather producers. It even goes as far as to put a figure on this.
It says: “Even if a definitive analysis of actual costs at the different production locations in the world may not be possible, it can nevertheless be stated with certainty that cost differences of easily more than 30% between Europe and Asia, starting with India, are visible without having to calculate with excessive precision.”
