New Louis Vuitton Handbags to Boast ‘Made in the USA’ Tags
Handbags and shoes are on display at the Louis Vuitton new flagship store on the Champs-Elysees in Paris (Photographer: Alastair Miller/Bloomberg News)

New Louis Vuitton Handbags to Boast ‘Made in the USA’ Tags

(Bloomberg) --

LVMH is following through on a pledge to create more U.S. manufacturing jobs, part of plan by Bernard Arnault, chairman of the French luxury conglomerate, to hedge against trade tensions and build on the rapport he’s established with President Donald Trump.

Trump and his daughter Ivanka are set to open a new Louis Vuitton factory with a ribbon-cutting ceremony in Texas on Thursday alongside Arnault, who is LVMH’s leading shareholder, and Michael Burke, the chief executive officer of its best-known brand.

New Louis Vuitton Handbags to Boast ‘Made in the USA’ Tags

In 2017, Arnault was one of the first CEOs to visit the president following his election, making the trip to Trump Tower along with his son Alexandre at a time when most fashion executives were paralyzed over how to approach the new commander-in-chief. Fashion was caught between threats of tariffs on foreign suppliers and concerns that consumers opposing Trump would boycott brands that supported the new administration.

Arnault, whose other luxury brands include Givenchy perfume, Hennessy cognac and Veuve Clicquot champagne, said at the time that the two had discussed increasing U.S. production.

Company Pledge

The leather-goods workshop in Keene, a small town near Dallas, will create about 1,000 jobs over the next five years, the brand said in a statement -- a drop in the bucket for the civilian U.S. labor force of 164 million people, but possibly enough to strengthen ties with Trump, who ran on a platform of reversing America’s industrial decline.

“This is consistent with Louis Vuitton’s recent signing of the Pledge to America’s Workers, which aims to expand programs that educate, train and support American workers,” Louis Vuitton said in a statement.

Much of the U.S. handbag manufacturing industry moved abroad with the production of garments and footwear over the past several decades, to countries like China, Vietnam and India. Several of the biggest bag sellers, including Coach and Kate Spade owner Tapestry Inc., have worked to diversify their supply chains and make fewer items in China as trade tensions persist.

The Louis Vuitton Rochambeau Ranch, named after a French general who aided the colonies in the American Revolution, will house the plant, which will start with 150 workers. The goods it produces will be tagged “Made in the USA,” but won’t use leather from Texas cattle.

Key product categories for LVMH including handbags and champagne were spared from retaliatory tariffs against European exports, set to go into effect on Friday, in a dispute over subsidies to Airbus SE. The list includes other luxury items and drinks, including French wine and Irish whiskey.

Louis Vuitton has already dabbled in U.S. production, making handbags and small accessories at plants in San Dimas, California. Arnault was a guest at Trump’s first state dinner, and First Lady Melania Trump has favored fashions from LVMH’s Christian Dior label for high-profile outings in France such as the D-Day remembrance ceremony in Normandy earlier this year.

©2019 Bloomberg L.P.

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