LVMH owner has lost as much as Jeff Bezos has gained – US$30 billion – in 2020, but Bernard Arnault is taking the long view
- His luxury empire faces a perfect storm, but Bernard Arnault’s LVMH has a cash pile big enough to ride out the crisis and keep expanding
- Frenchman has a made a career out of investing through downturns, though none as big as the one coronavirus has triggered
Undeterred, Arnault has been heading to his war room every day, where he’s fighting to keep a blockbuster acquisition and a couple of pharaonic real estate projects on track, while holding video calls with deputies as they prepare to reopen factories and boutiques in a virus-shaken world.
“He’s putting himself in a position to keep taking share once the market gets back to growth,” says Mario Ortelli, founding partner of luxury consultancy Ortelli & Co. in London.
Since the late 1980s, Arnault has dazzled – and at times scandalised – the rarefied world of French business with his prodigious flair for turning the creativity and craftsmanship of Europe’s oldest brands into a windfall of ever-growing profits. His flagship Louis Vuitton brand is estimated by analysts to have a profit margin as high as 45 per cent.
The mark-ups on that brand’s monogrammed trunks and handbags, as well as the earnings from other golden-goose products like Hennessy cognac and Dom Perignon champagne, have helped fuel Arnault’s expanding presence in most things rich people spend money on: whether they buy a Fendi handbag, a Bulgari watch, or stay at Venice’s Hotel Cipriani, they’re adding to Arnault’s coffers.