China's consumers spent $73.6 billion on luxury goods at home last year, up 36% from 2020

cnbc.com:

BEIJING — Chinese consumers are spending more on luxury goods at home, even if they can't easily travel abroad due to pandemic-related restrictions, consultancy Bain & Company said in its annual report on the luxury sector.

Sales of personal luxury goods in mainland China rose by 36% to 471 billion yuan ($73.59 billion) in 2021 from the prior year, according to Bain estimates released Thursday. That's more than double the 234 billion yuan in luxury goods spending on the mainland in 2019, before the pandemic.

The growth in luxury goods sales comes despite a slump in Chinese retail sales overall since the pandemic began in 2020. The data also reflects the growth of China's domestic market as a destination for international brands.

Mainland China's share of the global luxury market rose to about 21% in 2021, up from roughly 20% in 2020, according to Bain.

«We anticipate this growth to continue, putting the country on track to become the world's largest luxury goods market by 2025 — regardless of future international travel patterns,» the report said.

«China remains the best consumer story in the world,» the Bain analysts said, pointing to the country's growing middle class. «The average increase of disposable income remains higher than inflation.»

Leather goods sales grew by about 60% and was the fastest-growing category, followed by roughly 40% growth in fashion and lifestyle, the report said.

A major driver for the local luxury market is the growth of duty-free stores in Hainan, an island province in southern China. In the last two years, new government policies have cut taxes and introduced other business-friendly measures aimed at turning the region into a free-trade port and international consumption center.

Even