During the pandemic, the luxury and cosmetics industry in France saw a significant increase in wealth as consumers splurged on high-end products like handbags and grooming items. However, this trend has taken a sharp turn as three of the country’s wealthiest individuals – Bernard Arnault, Francoise Bettencourt Meyers, and Francois Pinault – have collectively lost $58 billion this year.
Arnault, the founder of LVMH, has seen his fortune decrease by about $26 billion, causing him to drop from the top position on the world’s richest list. The decline in wealth is attributed to reduced demand for luxury goods, especially in China, where the industry giants operate. Similarly, Bettencourt Meyers, the heiress of L’Oreal, has lost $19 billion this year as the company faced challenges in the Chinese market.
Pinault, the founder of Kering, experienced the most significant decline in wealth, with a 63% decrease to $22 billion. The troubles at Gucci, Kering’s biggest fashion label, have contributed to this decline. Despite efforts to turn around the brand, including store closures, the company continues to face challenges in the luxury market.
The drop in wealth for these billionaires comes at a time when there is increasing political pressure in France to tax the rich more to combat inequality and reduce the country’s deficit. This pressure, coupled with the decline in demand for luxury goods, has had a significant impact on the fortunes of Arnault, Bettencourt Meyers, and Pinault.
While the industry giants and billionaires have enjoyed a period of significant wealth accumulation in recent years, the current economic climate has brought about a shift in consumer behavior, leading to reduced spending on luxury items. As the world continues to navigate the challenges brought about by the pandemic, it remains to be seen how the luxury and cosmetics industry will adapt to these changing dynamics and whether the fortunes of the wealthiest individuals in the sector will rebound in the future.