Gucci, YSL owner pushes back on tariff threats
The luxury giant made it clear that it won't make changes just to keep the president happy.
I bought my first pair of Saint Laurent (YSL) heels when I used to be 25.
They had been all black patent leather-based within the enduring Tribute vogue, with crisscross straps and a sky-excessive platform that made fully no sense and all forms of sense on the identical time.
I'm succesful of’t endure in mind exactly why, nonetheless I had some reason to have an excellent time (or so I informed myself), and I couldn’t resist the frenzy of slipping these sneakers on within the YSL store at Copley in Boston.
They had been mettlesome. Rather aggressive. And fully, unapologetically French.
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That moment wasn’t practically vogue — it used to be about proudly owning something that felt love power. Striking them on used to be love flipping a switch: self perception, elegance, a dinky bit of edge.
Luxurious brands love YSL know exactly what they’re promoting. Particular, there’s craftsmanship and quality, nonetheless definitely, it’s culture. A tale. An principle that something made in France or Italy is price paying a top class.
So when presidents commence throwing round threats of tariffs and urging companies to movement manufacturing closer to residence, that opinion will get tested.
But Kering (PPRUY) , the company within the encourage of Gucci, YSL, and Bottega Veneta, fair made it plod: it has no design of budging. Image source: Sorbis/Shutterstock
Kering stands its floor as tariff threats loom
On the Q1 2025 earnings call, Kering CEO François-Henri Pinault made one thing plod: the company gained’t be transferring its manufacturing out of Europe in response to U.S. tariffs.
“Most of our brands we're producing in Italy and in France, and that's a part of the promise that we bring by our merchandise, by our heritage, to the buyer,” he informed investors.
He went even extra, adding, “We are promoting part of our culture, being an Italian culture or a French culture. So we set no longer have any opinion of producing to counter the tariff. It is unnecessary.”
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His comments came fair days after President Donald Trump signaled that sweeping new tariffs on goods from the European Union had been drawing discontinuance, calling the EU’s alternate actions “an atrocity.”
Pinault acknowledged the company already operates in dapper global markets (love China) where import tasks are common, and he emphasised that adjusting its entire present chain would dilute the very mark proposition luxurious traders are paying for.
Easy, Kering isn’t ignoring the matter. Pinault acknowledged the company may should rethink pricing arrangement if the tariffs dawdle into perform.
Luxurious big Kering below income stress
Tariffs aren’t the best predicament on Kering’s plate. In its most up-to-date outcomes, the crew reported a 14% descend in income for the vital quarter of 2025, totaling €3.9 billion.
Gucci continues to fight. The emblem introduced in €1.6 billion in Q1 2025, down 24% yr-over-yr. Sales fell sharply at some level of both its retail and wholesale channels. In the meantime, YSL posted €679 million in Q1 income, down 8%, with some resilience in European and Heart Eastern markets.
Kering closed 25 shops globally at some level of the quarter, and even supposing Bottega Veneta (up 4%) and its beauty and eyewear segments saw hiss, the crew’s overall trajectory remains challenged.
Pinault addressed the matter, pointing out, “We are increasing our vigilance to climate the macroeconomic headwinds our industry faces.”
The corporate additionally currently offloaded its stake in The Mall Luxurious Outlets and entered a joint mission for 3 Parisian actual property resources, strikes that signal a tighter focal level on its core industry and designate arrangement.
Kering’s message — heritage over haste — is one no longer all luxurious players may very well be in a predicament to give you the money for. But when it pulls by, it’ll be as a consequence of it stood by elegance, even when tariffs made shortcuts tempting.
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