This was another group that somehow thought the credit crisis would avoid them courtesy of emerging market support. It's true that many of the luxury brands have profited enormously in recent years due to the emerging markets (Russia, especially) but that too is now collapsing. Overpriced luxury was so 2006.
Chanel is to cut 200 jobs as fears grow that the supposedly recession proof luxury market is falling victim to the global credit crisis. Citing a steep decline in this year's sales, the largest French union, the CGT, said the losses at the French fashion label would concern all staff on fixed term and temporary contracts and come into effect on Wednesday. Sixteen posts would be cut from the brand's boutique on rue Cambon in the heart of Paris's fashion district, it added in a statement at the weekend.
The job losses, described by some commentators as the label's worst crisis since founder Coco Chanel fired all her staff at the outbreak of war in 1939, represent almost 10% of the company's production workforce. The redundancies come after a difficult year for the fashion, perfume, cosmetics and accessories businesses where growth has almost ground to a halt.
