Sitting in the lap of luxury

SHANGHAI - As if tuned to the tempo of the conductor's baton, the orchestra of the world's top fashion houses is playing a crescendo of price increases with surprising gusto.

The well-orchestrated move has shocked observers from New York to Shanghai, coming, as it does, at a time when demand for a pair of 3,600 yuan ($557) jeans from Prada SpA or a 9,600 yuan bag by Gucci SpA is widely expected to be doused by the unfolding debt crisis in Europe and the threat of a double-dip recession in the United States. As such, the orchestra should rather be playing diminuendo.

However, the Chinese audience is crying out for a march. While consumers in Japan, the United States and Europe are scrimping on luxury goods, the swelling ranks of big spenders in China are taking in whatever the "haute" houses in Paris or Milan can serve up. With demand underscored by an army of Chinese consumers, luxury brands feel no constraint in boosting their prices to cover rising costs and foreign exchange losses.

The price of an Amazona bag from the Madrid-based luxury clothing and accessories brand Loewe (a division of LVMH Group) soared to 22,000 yuan from 18,000 yuan in one week, a rise of more than 20 percent.

And Loewe is not alone. Its French peer Chanel SA has come out with an even more stunning price list since April 28. The price for a classic Maxi flap bag, for example, has been raised to 41, 000 yuan from 31,500 yuan, up more than 30 percent. In Hong Kong, the price for the same bag has increased to HK$43,200 ($5,544) from HK$31,800, a rise of more than 35 percent.

Known as "Jeweler to Kings, King of Jewelers", the Paris-based luxury jeweler Cartier SA assumed its role in this price-rise symphony as early as March 17. A gold ring from the company's Love series has seen its price surge to 6,800 yuan from 6,100 yuan, up about 11 percent.

And while Cartier fans have not fully recovered from this unexpected price increase, it is now widely rumored that price will surge again this month.