LVMH to operate 24 manufacturing sites in Italy by 2018
Italy is becoming increasingly important as a production hub for LVMH. In March, the French luxury group opened a new jewellery manufacturing facility for Bulgari in Valenza, Piedmont - Europe's largest - and now has turned its sights on Tuscany, where it plans to enlarge the production facilities for Fendi and Céline. LVMH also announced the building of a new eyewear factory in Longarone, in the Veneto region.
"This factory, once completed, will bring the total number of our production sites in Italy to 24, and will start operating in early 2018. We are building it with Marcolin, our eyewear partner, via the joint-venture company Thelios, in which we hold a 51% stake. The factory's initial output will be the Céline eyewear collections," said LVMH Group Managing Director Antonio Belloni, speaking at the opening ceremony for the group's Italian vocational training programme, held at the Institut des Métiers d’Excellence, LVMH's institute for luxury goods craftsmanship, in Florence.
"We manufacture 90% of our range in Europe, and over 80% of this output is sold outside the European borders. A large part of this output is produced in Italy," said Belloni, reminding his audience that LVMH employs 8,000 people in Italy, of whom 1,000 were hired in 2017, and operates 220 stores in the country, as well as featuring no less than seven Italian labels in its portfolio (Emilio Pucci, Bulgari, Fendi, Loro Piana, Acqua di Parma, footwear manufacturer Rossimoda and the Cova café chain).
Between 2012 and 2016, the world luxury goods number one invested €100 million a year in Italy, a figure which in 2017 rose to €150 million, and the trend will not slow down in the next few years, as the group is busy on several other projects.
Speaking in Florence, Antonio Belloni confirmed that Céline's leather goods factory in Radda in Chianti, Tuscany, will be enlarged. Work will start in 2018 and the renovated factory will be fully operational in 2019. "It is a question of bringing it to a new level, generating more jobs, with the workforce growing from the current number of 130 employees to 380-400," said Belloni.
The other new initiative regards Fendi. LVMH plans to eventually hire 350 employees, and build a factory specialised in leather goods in Bagno a Ripoli, close to Florence, where the group recently acquired a 90,000 m2 site, formerly home to a blast furnace. The factory will also be active in product development and prototype fabrication, with a section dedicated to exotic hides. Production is expected to start in summer 2019.
Still in Italy, the Loro Piana headquarters in Milan will change location in 2018, and will occupy the former premises of the Corriere della Sera newspaper in via Solferino. In Florence, LVMH is keen to make more use of Palazzo Pucci, the historic building still owned by the label's founding family, turning it into "an activity hub for the group, and making it more accessible to the general public." Besides the Emilio Pucci archives, the lavish building is also the Italian home of LVMH's institute for luxury goods craftsmanship.
Antonio Belloni hinted that LVMH is evaluating other major projects regarding its manufacturing activities in Italy, without adding any detail. Perhaps Louis Vuitton will be the next label to be involved.
As for the business forecast for 2018, the luxury giant, whose sales in the first nine months of this year grew by 14%, reaching €30.1 billion, is planning to "do a little better than in 2017." "We will continue on a positive track, always taking into account potential geopolitical risk factors, and the slightly less favourable euro [exchange rate]," concluded Antonio Belloni.
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