The luxury brand is now second only to LVMH.
In a time of economic uncertainty for many, Birkin maker Hermès is holding its own. The luxury brand has just become the world’s second most valuable in the luxury market after LVMH, with an impressive new market value beyond anything it’s ever seen before.
The luxury brand reached a historic milestone by exceeding a €200 billion ($218 billion) market value this week, per Bloomberg, soaring past Swiss pharmaceutical giant Novartis AG. This impressive feat is attributed to the luxury brand’s strong performance, rallying approximately 30 precent so far in 2023, buoyed by investor confidence in the high-end market’s continued success.
The surge in Hermès’s market value has been bolstered by China’s post-pandemic recovery, which has revitalized demand for luxury designer items. As a result, Hermès now stands as the eighth most valuable company across the pan-European Stoxx 600 index, and the second most valuable luxury brand in the world, second only to French luxury conglomerate LVMH Moet Hennessy Louis Vuitton SE, which is currently valued at €420 billion (about $455 billion).This achievement also elevated LVMH CEO Bernard Arnault’s fortune past the $200 billion mark this week.
Hermès has long stood apart from other luxury brands, with its unparalleled pricing power and high demand for its handbags. Birkin prices start at roughly $8,500 and go all the way up to over $400,000 for rarer models. In keeping with its sustained high demand, Hermès will be opening a new leather manufacturing facility in Louviers, Normandy, on Friday.
While Hermès has enjoyed exceptional success, the luxury market as a whole has been enjoying heightened post-Covid performance, with companies like Burberry and Hugo Boss AG also seeing recent growth. This growth in luxury shares has propelled Paris to the top spot as Europe’s premier stock market, outpacing previous top spot holder London.
With its market value now exceeding €200 billion, Hermès International has not only cemented its position as a powerhouse in the luxury sector but has also demonstrated the enduring appeal and resilience of high-end designer brands in times of economic adversity.