France’s sole remaining beret maker is getting a kick in the tête from inexpensive foreign knockoffs — a demoralizing setback for President François Hollande’s innovative plan to tax and regulate his country into a manufacturing powerhouse.
Bloomberg’s Helene Fouquet reports that Laulhère is struggling to emerge from a 2012 bankruptcy, challenged by a weak economy and an extremely unattractive competitive position. The company lost money last year and is hoping to break even by upping its production run this year:
Laulhere became the country’s sole maker of traditional berets after it recently bought Blancq-Olibet, its only French competitor, which was almost 200 years old. Cheaper knockoffs from China, India and the Czech Republic made survival hard for local makers of berets, which have been as much a symbol of France as baguettes and Gauloises cigarettes.
Based in the foothills of the French Pyrenees, where the round and flat woolen hat was invented by shepherds to protect themselves from the Basque region’s damp, Laulhere has joined the frontlines of the battle for the “Made in France” label as foreign-made berets steal an increasing share of a shrinking market. On its website, Laulhere says: “To us ‘Made in France’ still means something.”
It had better mean “at least ten times as good,” because imported berets go for about two euros in France, while Laulhère charges between 20 to 95 euros ($131) for women’s headgear and and between 40 and 75 euros ($103) for men’s.
Frédéric Bastiat is rolling over in his grave as his countrymen make lame-o excuses for the evolution of the market. Declining orders from foreign militaries and insufficient support from the French army, which cruelly ended mass conscription in 2001, are also blamed for creating a classic Keynesian demand gap.
As always, Hollande has a plan to fix that. Industry minister Arnaud Montebourg posed on a magazine cover with French-made products in 2012 and more recently hosted a “Made in France” in Paris while wearing a Laulhère beret.
If out-of-the-box central planning ideas like these are not enough to protect an obsolete and overpriced domestic industry, that would be enough to make Che Guevara sprain his wrist.