‘$1,400 bag for $38,000’: Chinese suppliers say they manufacture goods for US luxury brands for fraction of the price

As the tariff war between US and China escalates, with the nations imposing 145 per cent and 125 per cent tariffs respectively on each other, Chinese manufacturers are exposing how US luxury brands get their products made in the Asian country for a fraction of the cost. Social media has been inundated with videos of Chinese manufacturers stating that they make goods for some of the biggest brands in the world, including Louis Vuitton, Chanel, Birkin, Prada, Bobbi Brown and more. 

In one such video, a Chinese man, the owner of a luxury goods OEM, can be seen saying that these companies have attempted to move the manufacturing away from China to the US but the products manufactured are not of good quality.

He said that his company has been the OEM for most luxury brands including Gucci, Prada, Coach, Louis Vuitton, for the past 30 years. “For this, I am not proud because we are just making our wages. The profit margin for the people who are actually making the bags are very low,” he said, adding that they have the best quality control, craftsmanship, and a complete supply chain. 

He said that the luxury brands are trying to move their OEMs out of China. “They failed, because the OEM factories out of China don’t have good quality control, good craftsmanship, the workers are expensive or lazy, and they have no supply chain,” he said adding that they will always be the best OEM for luxury goods.

“Why don’t you just contact us and buy from us? You won’t believe the prices we will give you” he said.

In yet another video, the same man can be seen breaking down the cost of a Birkin bag. He took into account the high-end leather, the expensive thread, the hardware, the edge oil, interior lining, the zipper, the cloth bag, along with human resources, and priced the bag at $1,400, which Birkin sells for $38,000. 

“More than 90 per cent of the price is paid for its logo. But if you do not care about the logo, but just want the same quality and material, buy from us. 

In yet another video on social media, a woman is seen speaking to a factory owner, manufacturing beauty accessories. The woman says her factory makes goods for Chanel, Estee Lauder and L’Oreal. The influencer shows the packaged products of La Prairie, MAC, Bobbi Brown, Shu Uemura.

In another video, a woman can be seen talking about the manufacturers behind Nike, Adidas, FILA and UGG. FJF Group manufactures for Nike, Pou Chen Group makes goods for Adidas, HengLong Group creates for UGG, and Shengtai Group makes goods for FILA.

YaTing, CEO of a Chinese consulting group, said in a video that Ralph Lauren, Armani, Nike, Dior, Lululemon, Apple, Michael Kors, Coach, CK, Prada, Celine, Swarovski, Adidas, The North Face, Rimowa, Levi’s, Burberry, Versace, Chanel, Cartier, Ferragamo, Timberland, YSL, Victoria’s Secret, Puma, Disney, Max Mara, DKNY, Givenchy make many of their goods in China. “The producing cost is 1/10th of the price,” she said. 

China has repeated that it will fight against US ‘unilateral bullying’ and has asked the European Union and countries like Vietnam to band with it to push back against Trump’s tariffs.