US becomes key battleground as luxury brands chase wealthy American shoppers

NEW YORK: European luxury groups are stepping up their push into the United States, expanding store networks and staging high-profile fashion events as they seek to attract affluent American buyers at a time when demand in other major markets remains under pressure.

The luxury sector had begun to show signs of stabilising after two years of contraction, but the Iran war that began at the end of February has disrupted travel and weakened luxury spending well beyond the Middle East. China, which had been the main driver of luxury sales growth for the past two decades, is also still grappling with deflation and the after-effects of a property crisis, increasing the industry’s reliance on wealthy US consumers.

Marcus Morris-Eyton, portfolio manager at AllianceBernstein in London, said affluent American shoppers had been holding up better than consumers in other regions, particularly Europe, helped by the ongoing AI-driven market rally and solid wage growth.

"The US high-end consumer has been much more resilient than we are seeing elsewhere, especially in Europe,"

Luxury houses including LVMH, Moncler and Gucci have moved quickly to respond. Dior and Gucci presented their cruise collections in the United States last month, while Italian menswear group Zegna is due to unveil its Summer 2027 collection in Los Angeles on Friday. Real estate firm Savills said North America ranked first for new luxury store openings last year for the first time since it began tracking the data in 2016. Its global luxury retail report said North America accounted for about 27 per cent of worldwide luxury store openings in 2025, ahead of Europe at 26pc and China at 19pc. At the same time, total new luxury openings worldwide fell to their lowest level since 2020.

Store expansion beyond traditional hubs

Savills research found the United States has fewer luxury outlets relative to its number of ultra-wealthy consumers than China, suggesting room for further expansion. Todd Siegel, Chicago-based president of US retail at Savills, said many brands still see the American market as underpenetrated when measured against the country’s wealth base. He added that store investment is no longer limited to coastal gateway cities but is spreading to second-tier states and cities where high-net-worth residents have relocated in search of lower taxes than in California or New York.

Moncler has said that most of its store openings this year will be in the United States. It opened in Aspen in January and plans to launch its largest flagship store worldwide on Fifth Avenue in New York in the second half of the year, alongside additional sites in Valley Fair in California and in Dallas. Hermes opened its first stores in Nashville, Tennessee, and Scottsdale, Arizona, last year, and plans further openings this summer in Wilmette, north of Chicago, and in Williamsburg, Brooklyn, in September.

Americas growth outpaces other regions

Consultancy Bain described the luxury market as a two-speed world, with the United States and parts of Asia expanding while Europe and the Middle East are being affected by weaker tourist spending linked to the continuing Iran war. Most luxury companies do not break out US sales separately, but first-quarter results indicate that the wider Americas region has been performing more strongly than other markets.

Richemont, the owner of Cartier, reported that sales in the Americas rose 18pc from January to March, marking its ninth straight quarter of double-digit growth in the region. Stronger spending by US luxury customers has also supported American groups such as Ralph Lauren and Tapestry, the owner of Coach, whose sales have run ahead of rivals.

Halide Alagoz, Ralph Lauren’s chief product and merchandising officer, said the company’s core customers were continuing to spend despite broader uncertainty.

"Our core customers are loyal and resilient," Alagoz said. “What we see so far is that their behaviours are not changing. On the contrary, consumers during these turbulent times want to come to brands that they can trust.”

Tapestry chief executive Joanne Crevoiserat said the company still saw room to grow in North America.

"We’re building emotional connections and bringing new, younger consumers into the market in North America and beyond,"

Morgan Stanley analyst Edouard Aubin said upcoming US initial public offerings could help lift demand for high-end watches and jewellery, though he cautioned that American consumers account for only about 20pc to 22pc of global luxury spending.

"It’s nice, it’s helpful, but you need China to get better as well for the sector to really recover,"