Overview

• Investors fear luxury brands have relied too heavily on well-off shoppers and will suffer as their spending slows.
• Luxury companies lost $60 billion in value after sell-offs, with stocks in LVMH, Kering, and Hermès hit hard.
• Sales are declining in the U.S., the industry's largest market, while China's economic troubles and travel restrictions threaten demand there.
• Although the extremely wealthy may keep spending, middle and upper-income customers are at risk of cutting back during a global recession.
• Luxury brands have so far endured the crisis well but now appear vulnerable without robust demand from wealthy tourists and aspirational shoppers.