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Italy’s Leather Industry Continues to Consolidate

MILAN Organizers of Italy’s leather trade show Lineapelle expressed caution for the rest of the year as inflation, the conflict in the Red Sea and European Union regulations continue put pressure on small companies’ ability to compete on a global level.

“This year opened with several shadows on the horizon, which will inevitably lead to a ‘flat’ [growth] in the first half of the year, in-line with the 2023 trend, when we were faced with stock issues and brand overproduction. Unfortunately, the climate of uncertainty due to conflicts persists, inflationary pressures continue,” said Fulvia Bacchi, chief executive officer of the exhibition, which took place at Rho-Fiera Milano fairgrounds from Tuesday to Thursday. Lineapelle gathers leading companies across the leather supply chain, which includes accessories, components, fabrics, synthetic and model makers.

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“Last year, 2023, was a difficult year for the Italian tanning industry, with estimates of a drop in turnover of around 10 percent in value and 15 percent in volume,” Bacchi warned. Italy’s leather industry reported a rise in turnover of about 7.3 percent in 2022 to 4.5 billion euros, boosted by a 5 to 7 percent increase in sales to the interiors segment, according UNIC, Italy’s Tanners’ Association of which Bacchi is also general manager.

In its last report, Italy’s organization of leather goods manufacturers Assopellettieri, together with Italian fashion federation Confindustria Moda, reported a drop in the number of active leather goods (excluding tanneries) businesses operating in the sector, down 2.5 percent to 4,716 in 2023. Consolidation had a positive impact on employment — the number of employees rose by 3.3 percent in the same period.

Altofare Group is one new group specializing in luxury accessories and finishes. With the mission to aggregate the forces of small entities, it began investing in smaller companies in 2021 with support from private holding White Bridge Investments. Since then, it has accrued a total of 11 companies, 1,000 artisans and specialists under its own umbrella. The company made 200 million euros in 2022. In line with the luxury market, it expects its 2023 earnings to be slightly less. “We like to maintain the identity of these compan[ies] and help them benefit form our tech capabilities,” the company’s CEO Davide Aicardi told WWD at the fair.

Altofare artisan
An artisan employed by the Altofare Group.

The strength of consolidation was highlighted at the LVMH Métiers d’Art booth, which made its second appearance at Lineapelle, following the recent acquisition of the Spanish group Verdeveleno, known for the tanning and finishing of exotic leathers.

LVMH Métiers d’Art spans a variety of manufacturing facilities, with skilled craftspeople working in leather, exotic leathers and high-quality metal hardware globally. Since it was founded in 2015, it has grown to register sales of 700 million euros from 80 million euros when it started.

LVMH Métiers d’Art Kuroki
Heng Long collaborated with Kuroki to add denim effects to pieces.

At the fair, Heng Long, which it acquired in 2022, debuted its collaboration with Japanese company Kuroki, introducing crocodile skins splashed with an artful, denim effect. Heng Long also unfurled a collaboration with metalworking specialist Jade Groupe: exotic skins embellished with metal elements shaped like coral jewels applied to the leather.

Italian CEO Matteo de Rosa commented on how unexpected synergies like these are the benefits of having so many international companies under its umbrella. “We try to forge synergies between luxury players that don’t normally talk amongst themselves,” he said.

Lineapelle LVMH Métiers d’Art 

Last year, Italy’s leather supply chain reached a total of 33 billion euros, in-line with 2022, according to preliminary figures released by Confindustria Moda in mid-February. The 2023 figures rose significantly from 2021 levels, which saw 29 billion euros in revenues, as the industry continued to consolidate post-COVID-19 pandemic.

Confindustria Moda’s Annarita Pilotti also said that the small and medium-sized businesses that represent the backbone of the Italian economy are finding it difficult to compete in international markets.

“The relationship between labor costs and net wages is a problem, and it is important to facilitate the use of credit for small and medium-sized businesses. We hope to find support for our companies, to put them in the best position to compete in global markets,” she said.

Italy’s leather sector supply chain is made up of 60,000 companies, 2.5 million employees and is capable of generating a turnover of 150 billion dollars, said organizers of Lineapelle. Organizers saw its number of exhibitors to 1,167 from 1,330 recorded in September. The number of visitors rose to 25,376 from around 24,000 registered last February.

FOCUS ON INTERIORS

In response to difficult times, Lineapelle has invested in emphasizing the potential of the interior design sector with its Leather Duets project. Five installations were hosted at the center of the fair including collaborations between firms like Northern Italian tannery Manifattura di Domodossola and Padua-based furniture firm Nalesso, and another tie-up between Pisa-based fashionable leather specialist Accoppiatura Mistral and upscale furnishings firm Mantellassi 1926.

Mantellassi, in collaboration with Mistral, interpreted materials suitable for both the interiors and exteriors, taking inspiration from fashion trends. At the stand, walls were covered with calming hued boiserie and decorated with elegant patterns.

“We have strengthened a fashion product by transforming it into a furnishing product and we have created different interpretations that are visible within our space to convey the idea of ​​how these two worlds can coexist,” Mantellassi 1926 CEO Roberta Mantellassi.

The Leather Duets will be digitalized and exported in video format and showcased at both the New York and London editions of Lineapelle.

Bacchi said revenues generated from the interior design industry represent 30 percent for Italian tanneries.

Mantellassi
Mantellassi 1926 was one of the upscale furniture companies that showcased within Lineapelle’s Leather Duets section.

INNOVATION

Tel-Aviv, Israel-based Balena, a material science company that develops compostable and biodegradable thermoplastic materials, unveiled a breakthrough with outsole maker For Ever. Together, they showcased BioCir flex, a trademarked new sole that is fully industrially compatible and high in bio based content. CEO David Roubach said the breakthrough would pave the way for other footwear brands to embrace full circularity.

“It signifies that the vision of a fully compostable shoe is now a tangible reality. Demonstrating commitment throughout the entire lifecycle, we take pride in this partnership, offering a sustainable solution that contributes to a circular future in the footwear industry,” Roubach said.

Balena
Balena’s compostable sole.

Limonta, the 130-year-old textile company based in Lombardy with a 2023 turnover of about 177 million euros, launched the second edition of its animal-free brand Altera, a new material where cotton or recycled nylon are tanned and processed to resemble leather and even wears down over the years like leather, the company said. This season, they unveiled Gali’ a colorful varnish-effect range of materials in vibrant red, black and white. Its CEO Paolo Limonta said within the company’s interior design division investments are focused on innovation and commitment to sustainability, in response to the growing demands of the design market. “The Limonta Interiors division, specialized in the production of furnishing fabrics, is investing in the production of textile collections made with natural fibers and with certified origin.”

Limonta’s Gali’ range.
Limonta’s Gali’ range.

TRENDS
As far as colors are concerned, summer 2025 will be dominated by “warm, enveloping” hues, Lineapelle said. This was the case for Chivasso, Italy-based Bonaudo, a leading international company in the tanning sector that specializes in producing and processing high-quality leather. Zen tones of white, sunflower yellow and pine dominated the stand.

“Customers’ attention is focusing on a smaller number of suppliers capable of offering not only the highest product quality but also service, creative sensitivity, technical competence and certifications consistent with the growing needs of large groups,” the company’s CEO Alessandro Iliprandi said. Bonaudo explained he is increasingly catering to the ultra-high end corner of the market in which consumers are looking for materials and textures, and where “natural” is synonymous with ultra luxury. The firm closed 2023 with a consolidated turnover of 77 million euros, up by 5 percent from the previous year.

Bonaudo deer leather
A swathe of deer leather from Bonaudo.

Lineapelle’s fashion committee’s coordinator, Antonella Bertagnin, said the 2025 summer season is dominated by paradoxes. “For example, it is the encounter between vintage taste, luxury and supermodern solutions. Or, the continuous demand for naturalness (little coverage on materials) that lives in parallel with the success of artistry, of sometimes exaggerated finishing,” she said.

Bertagnin echoed Iliprandi, insisting that “caressing, soft” tones invite the wearer to appreciate the simplicity of napa leather, for example. “Contrasts and mash-ups are also to be found in the fabrics, while the world of small parts finds renewed linearity. The era of the excesses of super-flashy accessories seems to be over, making way for a cleaner image, a search for the smallest details. After a long period of success for gold, there is now a return to cooler tones for galvanics, with more fluid and rounded shapes,” she said.

OUTLOOK

Throughout the fair, China’s construction slowdown, inflation, high interest rates and raging global conflicts were talked about. Companies are faced with the impending task of rerouting their products around the Suez Canal, which will inevitably lead to higher energy and raw material prices. The furnishing sector is among those most impacted by shipping route alternatives, Mantellassi noted.

“Companies in the furniture industry are quickly adapting to the situation in the Suez Canal by implementing more flexible supply chain management strategies and different shipping routes to mitigate any delays. Increased transportation costs could impact product prices, potentially impacting industry revenues during 2024,” Mantellassi said.

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