Announcing the company’s 2024 results, Kering CEO Francois-Henri Pinault said the French giant’s brands represented European craftsmanship, so offshoring production to the U.S. “makes no sense.”

“Most of our brands, we’re producing in Italy and in France… we’re selling a part of our culture,” Pinault said during Kering’s earnings call. He pointed out that the company has long operated in big markets that impose import duties, such as China, which has resulted in higher product pricing.

A ripple effect of tariffs would be that Kering’s goods become cheaper in Europe than in the U.S., lifting demand from American tourists.

It’s hard to predict what might happen since Trump has not indicated whether or when he might impose tariffs. Either way, Pinault said Kering won’t offset the impact of tariffs by making its luxury leather bags and apparel in the States.

None of Kering’s brands produce their goods in the U.S., a spokesperson at the company old Fortune.

“We know how to maneuver that, I’m not too worried about it. But let’s see what happens,” Pinault said.

It’s unclear what Trump has planned for tariffs in Europe. During his campaign last year, he teased the idea of a 10-20% levy, vowing that the region would “pay a big price.” Since taking office, he has slapped tariffs of 25% on Mexico and Canada and 10% on China but has been silent about Europe so far. Still, the European Union is bracing itself to fight back.

Kering’s tone regarding tariffs contrasts with that of its archrival and fellow luxury conglomerate, LVMH. Last month, LVMH CEO Bernard Arnault said that Trump’s tariffs could make American production more subsidized, and the company intended to expand its presence in the market.

It’s also worth noting that Arnault was among the top business executives present at Trump’s inauguration, and they’ve known one another since before Trump’s first presidency.

The French-listed Kering has other pressing concerns. Its sales were down 12% in 2024, driven by a sharp 23% drop in Gucci’s revenue to €7.7 billion. On the other hand, its eyewear segment reported strong performance with a 24% bump in sales on Tuesday.

Kering has struggled amid a slump in luxury demand like its peers. Weakness in China and the changing appeal of its flagship brand have further depressed its performance.

Last week, the creative director of the company’s most lucrative brand, Gucci, left the company after his efforts to reignite the brand didn’t quite take off.

“Kering has many issues right now, but Gucci is core. If Gucci does not perform, Kering will not rerate, so they must get that right now,” Flavio Cereda, investment manager at GAM Investments, told Fortune on Monday.

While the annual sales continued to decline, it slightly beat analyst expectations, sparking hope that Kering’s worst days are in the past. Other luxury companies have reported better-than-expected results, pointing to a more optimistic 2025 for the entire sector.  

Kering said it would announce Gucci’s new creative director sooner rather than later, and Pinault assured investors that he had no doubt that “Gucci will come back.”

Update, February 11, 2025: This article has been updated with a comment from Kering stating that the company doesn’t produce any goods in the U.S.