Louis Vuitton raises prices in Korea only

Louis Vuitton opened a boutique shop in Incheon International Airport in Incheon in Sept. 2011. / Yonhap

By Kim Jae-heun

Louis Vuitton has raised prices for its items only in Korea, aiming for the critical moment of economic recovery here as shopping malls reopen to a sea of customers who have wallets full of cash and are ready to spend.

The markup came only two months after it increased prices by between 3 percent and 4 percent in March.

The latest price hike varied for handbags and clothing items but price increases ranged from 5 percent to 10 percent.

The French fashion house did not offer any explanation as to why it increased its prices in Korea.

“We have decided to raise the prices starting on May 5. It was part of our pricing policy based on the long-term view. Though, we cannot comment on how much we have increased our prices regarding individual items,” a Louis Vuitton Korea official said.

Louis Vuitton increased its prices twice in 2019, first in February and again in November. The markup in March came just three and a half months after the previous price increase but it has never raised prices twice in the first half of the year.

Luxury retailers usually hike prices in four situations. First, when their head offices decide to increase prices globally; second, when the exchange rate fluctuates; third, when production costs go up; and last, when labor costs rise.

Industry insiders say a bad exchange rate and the shutdown of Louis Vuitton's production lines in France and Italy have pressured the fashion brand to pass the financial burden onto its customers.

However, many consumers have voiced suspicions that the luxury retailer purposely increased the prices when the government relaxed social distancing rules.

As many people cannot travel overseas, they are spending money on luxury goods instead.

In February, while COVID-19 was imposing great economic damage to most brick-and-mortar retailers, including department stores and hypermarkets, sales at luxury-brand stores actually increased.

The four major department store franchises Shinsegae, Lotte Department Store, Hyundai Department Store and Galleria Department store all saw increased sales of luxury goods at their outlets.

Louis Vuitton watched for its chance and came in right as potential buyers are hitting stores again.

Again, an official at Louis Vuitton Korea failed to give an answer as to why their head office decided to raise prices at this particular moment.

Some customers have expressed that they feel dumbfounded and angry that the French fashion house did not give advance notice of the planned price rises to the public. This time, Louis Vuitton Korea did not even advise its sellers at department stores about the price hike until the day it started.

The prices of two popular handbags, the Speedy Bandouliere 30 and Bandouliere 35, have increased by 100,000 won each. Another steady-seller, the Ontergo MM's price also rose by 170,000 won while Mini Dauphine's price rose by 220,000 won.

While handbag prices have increased by 5 percent to 6 percent, clothing prices rose by up to 10 percent.

Louis Vuitton failed to issue any comment when asked if it only decided to increase prices in Korea or if price rises will apply to other countries as well.