EXCLUSIVE: McKinsey Says China to Account for 40 Percent World’s Luxury Spending by 2025

LONDON — Upper-middle income Chinese consumers are poised to spend, spend, spend in the coming years, and are already being targeted by the big fashion and luxury houses, according to a new report by McKinsey set for release this week. The latest edition of the McKinsey China luxury report, which will be published on Friday, said Chinese consumers will account for 40 percent of the world’s luxury spending by 2025, and will be a major contributor to growth in the sector over the next six years. The last edition was published in 2016. “China delivered more than half the global growth in luxury spending between 2012 and 2018, and is expected to deliver 65 percent of the world’s additional spending heading into 2025, according to McKinsey’s estimates based on UnionPay transaction data,” the report said. The report added that, in 2018, Chinese consumers at home and abroad spent 770 billion renminbi, or $115 billion, on luxury items, equivalent to a third of the global spend, with each luxury-consuming household splashing out an average of 80,000 renminbi a year. The growth has been driven by an explosion in the number of upper-middle-class households. “Their outlay is set to almost double to 1.2 trillion renminbi [or $183

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