Sales at Europe’s biggest luxury brands have fallen sharply in Dubai and Abu Dhabi as the Iran war disrupted what had been one of the sector’s fastest-growing markets, Reuters reported.
Luxury brands recorded decline in sales of 30-50 percent in March at the Mall of the Emirates compared with the same month last year. Brands such as Louis Vuitton, Dior, Gucci, Cartier, Chanel, and Rolex, reported 15 percent drop in sales in the region.
At the larger Dubai Mall, which is more reliant on tourist spending, traffic fell by around 50 percent, suggesting an even deeper drop in sales.
In Abu Dhabi, The Galleria Al Maryah Island reported a 10 percent drop in sales.
The Middle East had been one of the few bright spots for the global luxury industry, but the war has now dealt another setback to the sector, which already saw industry-wide sales fall 2 percent last year.
Even if diplomatic efforts succeed, recovery could take months. The region accounts for roughly 5 percent of global luxury consumption, but remains one of the most profitable retail markets for high-end brands due to low taxes, strong tourist inflows, and high per square metre sales.
