Hermès Hikes Prices in the U.S.

Yahoo

07-05-2025

PARIS — As the business world adjusts to the Trump administration's tariffs, Hermès International has followed through with the price increases promised during its most recent round of financial results.
Bernstein analysts examined prices on the brand's U.S. website across women's bags, jewelry, ready-to-wear, silks and accessories, watches, fragrances, makeup and home, concluding that prices have been bumped up an average of 4 to 5 percent across the board.
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'These will likely cover for a worst-case scenario of 10 percent tariffs and compensate for the recent weakening of the U.S. dollar against the euro,' Bernstein analyst Luca Solca wrote in a report this week.
Hermès' move follows Louis Vuitton raising its prices in the U.S. 3 to 4 percent in April.
Hermès can lean on its 'undisputed' pricing power, according to Bernstein. The company has steadily increased prices each year, but it still hasn't dented customers' desire: Sales were up 17 percent for the fourth quarter of 2024 and continued to rise in the first quarter, up 10 percent year-over-year.
In fact, the company is trying to increase production capacity for its popular handbags by building four new factories over the next four years after it was hit by tight supply over the holiday period and start of the year in the U.S., despite price increases of about 6 to 7 percent last year.
Hermès chief executive officer Axel Dumas believes the company's reputation makes it a steady choice for customers in turbulent times. Speaking at the company's annual shareholders' meeting on April 30, he recalled the 2008 financial crisis as raising the brand's value. 'There was a flight to quality,' he said. 'Hermès is the gold standard in a way.'
Hermès is still 'top-of-the-mind for consumers…particularly in China,' the Bernstein report noted.
'I think it pays for a brand like Hermès to sit at the very top of consumer desirability. When consumers are more guarded, when they have second thoughts about spending money, when they cut their budgets — think of the Chinese, for example — Hermès is the very last brand they give up on,' Solca told WWD.
'Almost all' pieces in the core categories of fashion and accessories have increased in price though handbags — including the Birkin, Kelly and Constance ranges — are not sold online. However, 'we expect price increases for these products to fall within a similar range,' Solca said in the report.