LVMH Not Worried About Fallout From Xinjiang Cotton Controversy
PARIS — LVMH Moët Hennessy Louis Vuitton is not worried about the potential fallout from the ongoing controversy over Xinjiang cotton.
In recent weeks, China has cracked down on foreign companies like Hennes & Mauritz AB that have said they won’t source cotton from Xinjiang due to concerns over alleged forced labor. The U.S. in January banned all goods made of cotton from China’s Xinjiang Uyghur Autonomous Region.
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A host of foreign brands have been ensnared, including Nike, Adidas, Uniqlo and Burberry, but H&M is the only one to have had its online stores on all the major Chinese e-commerce sites blocked.
During a conference call with analysts after LVMH published first-quarter sales, chief financial officer Jean-Jacques Guiony was asked whether he felt that any of the group’s major brands might be at risk from the Chinese boycott, which has seen Chinese brand ambassadors cut ties with the companies concerned.
Neither LVMH nor its brands have made any statement on the issue of Xinjiang cotton so far.
While he did not address the controversy directly, Guiony indicated he did not perceive a threat to the French luxury conglomerate, which generated 41 percent of its revenues in Asia in the first quarter, making it by far the most important geographic region for its business.
“I’ve never seen a big threat in being successful in a given country. Everybody’s talking about China being an issue. As far as I’m concerned, it’s more an opportunity than anything else,” he said.
“We are very happy with the business we do there and we believe that it’s a complex country, like any other business, I would say, and we are not particularly worried that something very bad could happen there,” Guiony added.
See also:
Assessing China’s Xinjiang Cotton Fallout
Did Xinjiang Cotton Crisis Up Stakes for Traceability?
Xinjiang Cotton: Li Ning, Anta Shares Surge While Nike, Adidas, Burberry Hit With Backlash
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