Luxury goods manufacturers are feeling the effects of the earthquake and tsunami in Japan, a key importer of the world's finest products
Financial aftershocks from the March 11 earthquake and tsunami in Japan have been reported in the quarterly earnings reports filed by the world’s producers of luxury goods.
The earthquake, which took place at the very end of the quarter, is expected to have an even bigger impact on company profits in the coming months.
Japan and China are the world’s largest consumers of luxury items – after the U.S. - with Japanese shoppers accounting for 11 percent of the luxury market, said The Guardian, a British journal.
Coach Inc., which markets modern classic American accessories, estimates that the events in Japan impacted their sales by about $20 million and cut earnings per share by about 2.5 cents for the fiscal quarter ending in March. The company projects the earthquake and tsunami will cause a total impact of 2 percent to Coach sales for the fiscal year ending July 2, 2011.
Automobile manufacturers and high tech companies continue to feel the impact from disruptions in supplies of parts and materials from Japan. Supply chain disruptions are predicted to hamper U.S. production and sales for as long as a year, and threaten to reduce company profits and lower the national gross domestic product.