CK and Tommy's parent companies have been listed as unreliable entities, and their brands may withdraw from the Chinese market

Recently, the Chinese Ministry of Commerce announced that it has decided to include the US PVH Group in the list of unreliable entities. According to the announcement, PVH Group has suspended normal transactions with Chinese companies and taken discriminatory measures against them due to violating normal market trading principles, seriously damaging the legitimate rights and interests of Chinese companies.

PVH Group is the world's second-largest clothing conglomerate, with multiple well-known brands such as Calvin Klein (CK) and Tommy Hilfiger under its umbrella. Being listed as an unreliable entity this time means that the group's import and export activities, domestic investments, etc. in the Chinese market will be restricted or completely prohibited.

Fashion industry insiders have stated that this also means that brands such as Calvin Klein and TOMMY HILFIGER will completely exit the Chinese market.

The root cause of this incident can be traced back to the Xinjiang Cotton Incident in 2021. PVH Group has been accused of issuing controversial statements on the Xinjiang cotton issue and implementing discriminatory procurement policies towards products from the Xinjiang region. In September 2024, the Chinese Ministry of Commerce launched a special investigation procedure against PVH Group, requiring it to submit compliance reports and supporting materials for its Xinjiang related business in the past three years. Although PVH Group claims to have submitted relevant supporting documents, the investigation results show that it has engaged in inappropriate behavior related to Xinjiang.

CK and Tommy Hilfiger brands under PVH Group once had a large network of stores and a high market share in the Chinese market. However, in recent years, the group has faced many challenges in the Chinese market, including changes in the consumer environment, awkward brand positioning, and intensified market competition. Being included in the list of unreliable entities this time will further exacerbate the difficulties of its business in China.

After being listed as an unreliable entity, PVH Group's stock price has fallen nearly 15% since September 24, 2024, severely undermining market confidence in its future development prospects.

These measures will have a profound impact on PVH Group's business operations, market competitiveness, and global strategic layout in China. At the same time, other international brands such as Nike and Adidas have not withdrawn from the Chinese market, but have increased their efforts in localization innovation and strategic layout. Domestic brands such as Bosideng are also constantly improving their competitiveness, further squeezing PVH Group's market share.

Resource: 潮新闻