Source: Ellen MacArthur Foundation Industry Whitepaper + ThredUp Global Resale Report 2026
The global pre-owned apparel industry has stepped out of niche vintage markets and become a core strategic business for nearly all international fashion groups in 2026, reshaping brand pricing, supply chain layout, policy lobbying and home textile derivative development simultaneously. According to the latest research released by circular economy authority Ellen MacArthur Foundation, the scale of worldwide secondhand clothing transactions will hit USD 317 billion by 2027, with an annual growth rate three times higher than new clothing retail. North America holds 40% of the global resale market share, while European platforms Vinted, Zalando and Vestiaire Collective lead the cross-border circulation of used garments across the continent.
A landmark joint statement signed by nearly 70 global fashion giants including Arc’teryx, H&M Group, Lacoste, Reformation, Primark, ThredUp and Vinted has drawn widespread industry attention in May 2026. The coalition formally submitted three major policy appeals to the EU, United States and Canadian governments, aiming to break the long-term economic imbalance that makes manufacturing brand-new clothing far more profitable than garment repair and secondhand resale. First, the alliance demands VAT cuts for secondhand goods within the EU and full elimination of clothing sales tax in North America’s secondhand sector. Second, they push for labour tax relief for clothing repair workshops in Europe and special tax credit policies for garment restoration enterprises in the U.S. and Canada. Third, the group calls for complete optimization of the textile Extended Producer Responsibility (EPR) system, using EPR tax revenue to build large-scale automated collection and AI sorting infrastructure for waste textiles.
Leyla Ertur, Chief Sustainability Officer of H&M Group, pointed out in an exclusive interview that current tax rules create invisible barriers to circular business models. Repair and resale can extend garment service life by 2 to 5 times, cut carbon emissions by over 70% compared with producing new apparel, and satisfy dual consumer demands for affordability and environmental protection. However, double taxation and high labour costs keep many small repair studios and secondhand stores barely profitable. If governments adjust tax mechanisms to support circular consumption, the whole industry can realize large-scale carbon reduction within three years without relying on huge capital investment in new recycling factories.
The luxury segment has witnessed the most dramatic resale market changes since early 2026. After Demna Gvasalia’s debut FW26 runway show for Gucci, the transaction volume of vintage Gucci coats, tailored suits and silk scarves on Vinted and ThredUp surged 47% in just seven days, with the average resale premium jumping 35%. Launchmetrics data shows the show created USD 54.6 million earned media value, surpassing Prada and ranking first among all Milan Fashion Week brands. Internal supply chain sources from Kering Group revealed Gucci is expanding clothing take-back stations in all European flagship boutiques. Recovered vintage Gucci fabrics will be upcycled into limited-edition jacquard cushions and wool throws under the Gucci Décor home textile line, forming a closed loop from luxury apparel to high-end soft furnishings.
Other luxury houses have followed this circular layout. LVMH’s Life 360 circular programme recorded 500 million euros in revenue from garment repair, old product recycling and refurbishment in 2025. The group completely abandoned the outdated practice of incinerating unsold inventory; leftover luxury silk, wool and jacquard fabrics are remade into small accessories and exclusive home textile decorations. Stella McCartney’s Mylo mushroom leather handbag collection, crafted from fungus mycelium bio-material, crashed the official website twice within two hours after launch, with the restock waiting list exceeding 2,000 buyers. All inner linings of the handbags adopt recycled polyester home textile fabric, free of animal leather and virgin fossil fibres.
Fast fashion and outdoor brands also accelerate circular transformation to cope with the EU’s mandatory textile EPR regulation fully effective from March 2026. All apparel and home textile brands selling products in EU territories must pay proportional recycling fees based on sales volume, covering waste textile collection, AI optical sorting, fibre regeneration and harmless disposal. Zara parent Inditex cooperates with recycling tech firms Amber Cycle and Circ to separate mixed cotton-polyester waste fabrics without fibre damage, producing high-purity recycled polyester for bed linens and hotel curtains. Patagonia expands its Worn Wear global repair network, offering free garment mending in all physical stores; European repair technicians’ average salary has risen 30% year-on-year due to severe labour shortages.
Industry analysts forecast two clear development directions for circular fashion in the next five years. First, AI full-chain technology will lower recycling costs significantly: AI pattern design shortens sample development cycles by 70%, AI sorting equipment identifies 50 textiles per second with 99.2% accuracy, and AI demand forecasting reduces overstock waste by 32%. The global AI textile market is projected to reach USD 21 billion by 2033, first demonstrated comprehensively at Heimtextil Frankfurt’s Retail Stage AI design zone. Second, bio-based and single-fabric materials will replace traditional hard-to-recycle blended textiles, with seaweed fibre, sugarcane bio-spandex and CiCLO biodegradable polyester becoming mainstream raw materials for both clothing and home textiles.
Consumption logic has undergone fundamental shifts across Western markets. 89% of global Gen Z and millennial consumers plan to increase secondhand fashion purchases, and nearly half of luxury buyers check resale prices before buying new designer pieces. Instead of viewing secondhand products as inferior alternatives, young shoppers regard vintage and upcycled items as unique exclusive collections with richer cultural value. Combined with tightening global carbon policies and rising raw material costs, the secondhand and circular textile economy is no longer a temporary marketing trend but an irreversible core growth track for the entire global apparel and home textile industry.
