Bernard Arnault Claims Shift on The List Of World’s Richest Due to China’s Moves
Bernard Arnault, the influential head of LVMH, briefly slipped into the ranks of the world’s wealthiest individuals but quickly regained his position as the fifth-richest person. After shedding approximately $54 billion due to a slump in the luxury market, Arnault bounced back. Both the drop and the recovery in Arnault’s wealth were largely driven by one key factor which is China.
As the majority owner of LVMH, holding around 48% of the company, Arnault’s fortune has mirrored the rise and fall of its sales over the years. During the pandemic, a surge in luxury spending sent LVMH’s profits soaring, making Arnault the world’s richest man at one point. Between 2017 and 2021, China’s luxury market saw explosive growth, tripling in size as the country’s middle class embraced high-end purchases and economic conditions remained favorable.
However, since last year, a slowdown in China’s post-pandemic recovery and hesitant consumer spending have negatively impacted LVMH’s earnings. Shares in the luxury giant, which owns brands like Christian Dior, Loro Piana, and Moët & Chandon, have dropped by around 9% since the start of the year.
Yet, the luxury market experienced a recent boost after positive economic signals from China. The announcement of stimulus measures aimed at revitalizing the Chinese economy—including interest rate cuts and support for stock markets and the property sector—has helped lift global markets. In particular, China is reportedly considering a massive $140 billion aid package to support state banks, which could, in turn, bolster businesses and consumer spending.
For LVMH, China represents a critical market, as Asia (excluding Japan) accounted for 31% of the group’s sales in 2023. As China’s economy shows signs of recovery, the luxury sector is hopeful that demand will follow suit. Arnault’s wealth surged by $6 billion in a single day following the positive news from China, bringing his current net worth to $183 billion.
China’s importance as the world’s second-largest economy and a key market for luxury brands has been a point of concern not just for LVMH, but also for competitors like Kering and Richemont. The recent measures by Beijing to boost its economic prospects have sent shares in both European and Asian markets higher, with hopes that a recovery in China will benefit global business.
As LVMH’s founder and CEO, Arnault has no intention of stepping down anytime soon. While his five children are involved in various roles across the company as part of a succession plan, the 75-year-old billionaire plans to stay in control for as long as possible. Arnault remains firmly in the exclusive group of individuals with a net worth exceeding $100 billion. As of now, he holds the distinction of being France’s only representative in this elite club.
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