According to a analysis published today at Reuters will luxury goods providers (high end market) have a dim outlook for the near future and need to brace themselves for at least two more years of pain, with big-ticket items suffering most. Luxury goods executives told the Reuters Global Luxury Summit this week they were doing their best to preserve cash and cut costs and cutting advertising. It will probably take longer than first thought to reverse negative trends as consumers feel uncomfortable spending high amounts of money while thousands are losing their jobs and the economic future remains uncertain! "I think the crisis is very deep," said Lamborghini Chief Executive Stephan Winkelmann, adding the sports car maker had cut production by 30 percent this year. "A lot of companies are going out of business," he said. Global luxury goods sales are set to drop by at least 10 percent this year and remain sluggish in 2010, industry experts and analysts predict. Consultants Bain & Co do not see a full recovery before 2012.
The longer term prospects of the luxury industry remain attractive as the number of affluent buyers is set to rise further and several regions such as central Asia, Siberia, Latin America and India have not yet been fully tapped. But this is unlikely to be enough to make up for the pain in established markets, especially as the slowdown is forcing luxury groups to hold back investments in the newer frontiers. "Emerging markets growth is likely to contribute the bulk of future luxury goods market growth but it is not likely to offset the impact of lower macro-economic growth in the next 5-10 years and bring us back to luxury goods market growth of the past 5-10 years," Bernstein Research said in a note.
The global economic crisis could change the entire landscape of the luxury goods industry. Bill McComb says “the world has changed and it’s not going back to business as usual.” Watch the video below and listen to what McComb described as the “new normal” .
What will be the impact of this general drift be on Baja California?? Baja Infotheque Network just likes to remind at the many so called "high-end" developments all along the Baja peninsula, many of them on hold or progressing very slow since no investors are willing to spend money right now and the developers them self don't have the means to finish the projects out of their own pockets. Is that all so bad?? We don't think so - it's gonna be more like a natural cleansing, the good ones - preparing themselves since the bubble-burst last fall for what is now is emerging as in the report stated by analysts. Analysts that have no interest on certain areas on the globe or certain market to be "bad" or "good" but plain and simple work on their analysis by facts given
