French luxury groups such as Kering and LVMH are struggling with their businesses in Japan, with sales declining compared to the same period last year. The slowdown of China’s economy and the fading of the high-spending boom among Chinese tourists to Japan are forcing luxury brands to reassess their strategies. By contrast, Hermès International, which has a strong customer base among the ultra-wealthy, continues to perform robustly.
The backdrop is the decline in spending by Chinese tourists, long a key driver of luxury consumption in Japan.
According to statistics from the Japan Tourism Agency, the average shopping expenditure of Chinese visitors to Japan fell by 29% year on year in April–June 2025 to JPY 97,162 (about USD 659).
Yayoi Sakanaka, Senior Economist at Mizuho Research & Technologies, noted: “China’s economic slowdown has weakened purchasing power, while the stronger yen has reduced the sense of relative affordability. As a result, demand from inbound tourists—which had previously supported domestic luxury consumption—is now declining.”
