Hermès to Raise Prices in the US to Combat Trump’s Tariffs
After reporting lower than expected sales in the first quarter of 2025, luxury brand Hermès has announced plans to increase prices on all products sold in the United States. This move is in response to President Donald Trump’s new tariffs, which have put a strain on the company’s profits.
According to Finance Chief Eric du Halgouet, the brand will be raising prices across all business lines starting May 1st. This is to offset the impact of the new duties imposed by the US government. The French brand had previously warned consumers of potential price hikes due to tariffs and has already increased prices by 6% this year as part of its annual price hike.
Despite the price increase, Hermès reported a 7.2% increase in sales for the first quarter, reaching €4.1 billion EUR ($4.66 billion USD). However, analysts had expected a higher increase of 9.8%. Du Halgouet stated that consumer behavior in the US has not changed, with the company reporting a double-digit increase in sales in the region. The exact amount of the price increase has not been disclosed, but it is expected that the brand’s loyal customers will continue to demand its exclusive leather goods.
Last week, Trump announced a 10% duty rate on imports from around the world, with the potential for higher tariffs of 20% on fashion and leather goods from Europe. This news comes at a time when the luxury sector is facing a slowdown in spending, caused by a combination of post-pandemic fatigue, high inflation rates, and a slowing economy. China, a key market for luxury brands, is also facing a debt crisis and real estate crash, further impacting the industry.
Despite these challenges, Hermès has managed to defy the luxury slowdown, although it has struggled to increase demand in China. The brand’s full Q1 2025 financial report can be viewed here.
