The pandemic era saw a boom in luxury spending, with consumers indulging in high-end handbags, glamorous gowns, and premium cosmetics. However, as spending habits shift toward restraint, some of France’s wealthiest individuals are feeling the pinch.
Bernard Arnault, Françoise Bettencourt Meyers, and François Pinault—three of the nation’s leading billionaires—have collectively lost a staggering $58 billion this year, according to the Bloomberg Billionaires Index. This decline comes as their companies—LVMH, L’Oréal SA, and Kering SA—report decreased demand for luxury goods, particularly in China.
During the pandemic, these titans of industry saw their fortunes soar, placing them in the same league as tech and finance moguls like Elon Musk and Warren Buffett. Now, their fortunes are on the decline, coinciding with growing political pressure in France for higher taxes on the wealthy to address rising inequality and a significant national deficit.
François Pinault, 88, has experienced the most drastic drop, with his fortune plummeting 63% to $22 billion since its peak in August 2021. This decline is largely attributed to challenges facing Gucci, Kering’s flagship brand. “We are implementing a radical transformation at Gucci,” said Kering’s chief financial officer Armelle Poulou, noting the need for store closures amid a tough market.
Having passed control of Kering to his son François-Henri nearly two decades ago, Pinault has shifted his focus to his art collection and museum projects in Paris and Venice. François-Henri is committed to revitalizing Gucci, but this week marked the third warning on sales for 2024.
Bernard Arnault’s wealth has also taken a significant hit, shrinking by around $26 billion this year. Once ranked as the world’s richest person, Arnault has fallen to fifth place on the Bloomberg index as shares of LVMH have tumbled 30% from their mid-2023 peak.
Meanwhile, cosmetics giant L’Oréal has reported disappointing results, resulting in a loss of $19 billion for Françoise Bettencourt Meyers, leaving her net worth at $81 billion. The 71-year-old heiress, who was once the world’s wealthiest woman, now trails behind Alice Walton.
“The turbulence in North Asia, particularly in China, has been worse than expected for luxury goods,” said L’Oréal CEO Nicolas Hieronimus during a recent analysts’ call. Despite stable performance in Europe, North America, and emerging markets, the company noted that business in China has significantly declined compared to pre-COVID levels.
As luxury spending cools, these billionaires are grappling with the realities of a changing market landscape.
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