Latest rankings of luxury brands: Six out of the top ten are from France, with LV at the top but sales declining for the first time, while Hermès shows strong momentum

According to Morgan Stanley's latest release of the 2024 global luxury brand rankings, the luxury goods industry is undergoing a critical turning point. Six of the top ten brands are from France, highlighting France's absolute dominance in the luxury sector.

According to news from the Chase Trading Desk, Morgan Stanley pointed out in a research report on June 3 that 2024 marks an important inflection point in the development of the luxury goods industry. For more than twenty years, large luxury brands have been gaining market share, leading to polarization within the industry. Among them, from 2016 to 2024, the five major brands in the fashion and leather goods vertical (Louis Vuitton, Chanel, Hermès, Dior, and Gucci) accounted for about 72% of industry growth and approximately 82% of profit growth.

However, analysts believe that the trend of industry concentration that has continued for more than twenty years is reversing for the first time in 2024, with top brands collectively losing market share, and the industry may be entering a phase of differentiation. According to Morgan Stanley's estimates, Louis Vuitton's sales (excluding the pandemic) are expected to decline for the first time in 2024. Chanel Group's sales are expected to drop by 5% to €16.8 billion. Gucci is performing even worse, with a revenue decline of 22.5% to €7.7 billion, the largest drop among the top ten brands.

According to the report, the top ten luxury brands ranked by revenue in 2024 are: Louis Vuitton (France), Chanel (France), Hermès (France), Dior (France), Rolex (Switzerland), Cartier (France), Gucci (Italy), Tiffany (USA), Prada (Italy), and Van Cleef & Arpels (France), which made the top ten for the first time.

Louis Vuitton: The king's position remains solid, but the growth myth is shattered

Louis Vuitton remains the largest and most profitable luxury brand.

According to the report, sales in 2024 are expected to be €22.2 billion, with an operating profit of €10.9 billion (a profit margin of 49%). Its profit is equivalent to the sum of the second-ranked Hermès (€6.2 billion) and the third-ranked Chanel (€4.3 billion).

However, a historic turning point has emerged: in 2024, Louis Vuitton's sales are expected to decline by about 1.5% to €22.2 billion, marking the first annual sales contraction on record (excluding the first year of the COVID-19 pandemic when stores were largely closed).

Even during the global financial crisis of 2008/09, Louis Vuitton only experienced contraction in one quarter (the second quarter of 2009) and still achieved about 3% growth for the entire year Analysis indicates that the key to this change lies in the limitations of pricing strategies. Louis Vuitton has raised prices by about 60% from 2019 to 2024, and it can no longer offset sales pressure through significant price increases as it did during the financial crisis.

Chanel: The Second Largest Brand Faces Challenges

Chanel's sales in 2024 are projected to be €16.3 billion, maintaining its position as the second-largest brand.

From 2016 to 2024, Chanel's sales grew at a compound annual growth rate of 10%, reaching €17.3 billion.

However, in 2024, Chanel's group sales are expected to decline by 5% to €16.8 billion. According to the company's estimates, the leather goods category is likely to see a double-digit decline (in contrast, Hermès' leather goods sales are expected to grow by 16% in 2024).

Chanel CEO Leena Nair expressed "great caution" regarding the outlook for 2025, believing that the environment remains "uncertain."

Hermès: Strong Growth

Against the backdrop of overall industry pressure, Hermès stands out with remarkable performance.

The report indicates that Hermès is expected to grow by 13% (in euro terms) in 2024, making it the fastest-growing brand.

Over the past decade, Hermès' sales have grown at a compound annual growth rate of 14%, reaching €14.8 billion in 2024, ranking among the fastest-growing brands in the top ten alongside Dior.

Although the quality of Hermès' growth in 2024 is not as strong as in previous years, analysts expect continued strong growth in 2025, with revenue projected to increase by 10.2% (11.3% organic growth), gaining significantly more market contribution.

Significant Changes in Industry Landscape

Dior has grown by 14% over the past decade, with revenue reaching €12.2 billion in 2024, but this year it declined by 10.1%.

Rolex is expected to have revenue of about €11.1 billion in 2024, growing by 5%, moving up from sixth to fifth place. Notably, this is the first time Rolex has seen a decline in sales since 2009, with 1.18 million units sold in 2024, a decrease of 2%.

Despite this, Rolex's market share in the Swiss watch market reached 32.1%, a dominant position far exceeding the performance of other brands in their respective fields. In comparison, Louis Vuitton's market share in the luxury handbag market is about 19%.

Cartier reported revenue of €10.9 billion, growing by 3.3%, surpassing €10 billion for the first time.

Gucci performed extremely poorly, with revenue declining by 22.5% to €7.7 billion, making it the largest drop among the top ten brands.

Tiffany reported sales of €5.1 billion, a decrease of 2%. Prada grew by 2.2% to €3.9 billion.

In 2024, Van Cleef & Arpels entered the top ten luxury brands for the first time, with sales of about €3.9 billion, growing by approximately 8%. The brand's sales grew from about €750 million in 2013 to about €3.9 billion in 2024, making it the best-performing jewelry brand