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Luxury brands face tariff-driven price hikes, risking customer loss amid economic uncertainty.
Luxury brands in the U.S. are reconsidering their pricing strategies due to a 15% tariff on EU goods, imposed by a trade deal between the U.S. and EU, which threatens their profit margins.
Brands like Chanel, Dior, and Louis Vuitton, which have relied on price hikes, now face the challenge of increasing prices without alienating customers.
A 15% tariff could necessitate a 2% price increase in the U.S., risking a 3% hit to earnings.
The luxury sector, already losing customers due to inflation and economic uncertainty, must balance price adjustments to avoid alienating consumers.
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