PARIS — Europe’s flight freeze due to volcanic ash, which entered its fifth day Monday, is already impacting the fashion industry: scuttling or postponing events, stranding designers and executives and raising the specter of dampening the region’s fragile economic recovery.
The ongoing disruption as a result of volcanic ash from Iceland has impacted designers from Giorgio Armani to Ralph Lauren, as well as cosmetics industry executives and design editors in Milan for various trade fairs. European authorities said they hoped some flights could begin today but the backlog of passengers and planes is likely to continue to strand people for days.
French civil aviation authority DGAC said flights in the Paris region would remain suspended until today at least. As a result, Paris airport authority ADP asked passengers, regardless of their destination, to stay at home until further notice.
Luca Solca, senior research analyst at Bernstein Research in London, noted that travelers were an important source of luxury sales.
“I expect that the airline standstill is a negative for duty free sales and for luxury in general,” he said. “If this was to be protracted, we would also have inventory issues, but I think this would probably have to go on for weeks before you have this effect.”
At trade shows in Milan and Bologna, competitors cozied up as the travel embargo fostered a newfound camaraderie among those united in misfortune.
Cosmetics industry executives attending the Cosmoprof fair, which ended its four-day run in Bologna on Monday, resorted to alternative means of transport, including buses and taxis.
“So many of us in the cosmetics industry are stranded here in Europe,” Caroline Pieper-Vogt, president and chief executive officer of Fusion Brands Inc., wrote in an e-mail. “[There are] very interesting stories of competitors partnering up and problem-solving on how to get home.”
Pieper-Vogt embarked on a 15-hour car trek from Paris to Madrid in hopes of catching a plane via Colombia back home to New York.
The can-do spirit failed for John Paul DeJoria, founder of John Paul Mitchell Systems, who missed the brand’s 30th anniversary celebrations. He attempted to charter a private jet, but refueling stops would have required the plane to land every 1,500 miles, making the trip an epic 36 hours long.
Designers, editors and furniture buyers attending the Salone del Mobile, which ran from April 14 to 19 in Milan, scrambled for ways to escape as the volcano ash cloud spread over Europe.
Giles Deacon, in town for a Fay presentation, rushed to Milan’s Central Station on Thursday night as soon as he heard about it. He said the station was so crowded he ended up hiring a car and driver and traveling through France to take the Eurostar to London, for what ended up being a 21-hour journey.
Others stayed behind and shopped. Alberto Baldan, general manager at high-end department store La Rinascente, said business during the week was up 13 percent year-on-year and the weekend, in particular, registered an increase compared to 2009. “It’s likely [the air freeze] forced many people to stay in Milan over the weekend,” said Baldan.
Ralph Lauren, in Paris last week to inaugurate his largest Polo Ralph Lauren store in Europe, is among Americans stranded in the French capital. About 40 Polo employees, in town for the opening, are in the same situation, as is Thom Browne, also stranded in Paris.
Activewear brand Puma AG canceled a planned press conference on Monday at its headquarters in Herzogenaurach, Germany, at which chairman and ceo Jochen Zeitz was due to unveil its strategy for the soccer World Cup in the presence of guests including Bayern Munich striker Mario Gómez.
No new date has been set for the event, said a spokeswoman for retail-to-luxury group PPR, which owns Puma.
A spokeswoman for fellow PPR brand Gucci, which is set to open its London pop-up store on Thursday and hold an opening party on Wednesday night, said the company is monitoring the situation.
Gucci’s creative director, Frida Giannini, is in Rome and had been planning to arrive in London today to take press on a walk-through of the store. “We’re looking into different options of getting Frida to London,” the spokeswoman said.
Meanwhile, Giorgio Armani, who has postponed the launch of his first hotel in Dubai three times already for unrelated reasons, has again pushed back the event. A company spokeswoman said the celebrations scheduled for Wednesday — including a fashion show and party — are now provisionally set for April 27.
The postponement will not affect the format of the opening, and Armani is slated to attend, she added.
Another event that had to be postponed because of the chaos is the 2010 World Retail Congress, which originally was scheduled to open Wednesday at the Hotel Intercontinental in Berlin. The organizers said with much of European airspace still closed Monday, too many speakers and delegates couldn’t reach Berlin in time for the three-day event.
The World Retail Congress has been rescheduled for October 2010 in the same Berlin venue. Details will be announced in the next few days, the organizers said.
For major high-street chains including Swedish retailer Hennes & Mauritz and Spain’s Inditex, the air transit situation has not had any significant impact on deliveries to their stores so far.
The situation was more complicated for online retailers like Net-a-porter.com, which said shipments within Europe were being delayed by one to three business days, while parcels destined for Africa, Asia, the Middle East and Australasia were incurring delays of three to five business days.
François-Marie Grau, general secretary of the French Women’s Ready-to-Wear Federation, said he was not particularly worried about the impact on retail of the plane cancellations, given the situation was expected to return to normal by the end of next week, according to weather forecasters.
Sigfried Jacobs, associate director of the German Association of Apparel Retailers (BTE), noted most merchandise is shipped in sea containers, so the flight embargo won’t seriously impact delivery cycles.
European airport duty free and in-flight sales, on the other hand, have ground to a halt since the planes have been grounded.
European airport shops and sales onboard European airlines represented 33 percent of worldwide travel-retail sales in 2008, said Jérôme Goldberg, managing director of JMG Research, citing figures compiled by tracking firm Generation Research.
World Duty Free (WDF), which has stores in 22 airports in the U.K., said the scenario was unprecedented, but noted it had a history of dealing with unpredictable world events, including 9/11, the Asian economic crisis and epidemics such as avian flu.
Philipp Wolff, director of communication for Hugo Boss, suggested the air traffic chaos provided an opportunity to take stock.
“Perhaps we need to time to think about the world, and realize it doesn’t always function the way we think it should, and to think about how we travel,” he said. “Of course [the flight ban] is bad for the economy. But maybe it’s good for nature.”
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