EU-US deal on tariffs: “not excellent news” for the cosmetics sector, says L’Oréal CEO

The announcement of 15% US tariffs “will not be excellent news” for the cosmetics sector, a key European trade, L’Oréal CEO Nicolas Hieronimus instructed AFP on Wednesday, July 30, however added the affect would stay “manageable” for the corporate.

“”We’re going from 0% to fifteen%, so in fact we’re not happy,” Hieronimus mentioned throughout the group’s half-year outcomes presentation. “Ultimately, Europe — with almost 500 million customers — pays greater customs duties than the UK,” he famous.

He additionally highlighted that the cosmetics trade helps over 3 million jobs throughout Europe, contributes EUR 180 billion to the continent’s GDP, and is France’s second-largest contributor to the nationwide commerce stability.

“I stay disillusioned by this settlement,” he mentioned, regardless that “the constructive side is that it supplies visibility and due to this fact removes uncertainty. We are able to now plan forward.”

Hieronimus additionally mentioned the Worth of Magnificence Alliance – a coalition of main European magnificence gamers, which incorporates Beiersdorf, L’Oréal, Givaudan, IFF, Puig, Ancorotti Cosmetics – will enchantment to European leaders to raised shield the European cosmetics and private care trade.

Extra particularly, he goals to concentrate on simplifying laws and avoiding a state of affairs the place the trade faces “customs duties on one facet and laws on the opposite.”

The CEO acknowledged that for L’Oréal, the 15% U.S. tariffs are “manageable.”

“Not less than for this yr, they won’t have a major affect on our capacity to satisfy our efficiency targets,” he mentioned.

The USA was the “main contributor” to the group’s development within the first half of the yr, Nicolas Hieronimus mentioned.

L’Oréal, which derives 27% of its income from North America, produces half of the merchandise it sells within the area at its 4 U.S.-based factories. The corporate has additionally “stockpiled luxurious merchandise” and perfumes, and will implement slight worth will increase to assist offset the affect of the tariffs.