Luxury Goods

Arnault Son Climbs LVMH’s Top Ranks in Further Leadership Reshuffle

Author: Editors Desk Source: WSJ:

November 14, 2024 at 09:08

Alexandre Arnault with his father, LVMH Chairman Bernard Arnault. Photo: Nathan Laine/Bloomberg News

Changes are the latest in a wider generational shift in the luxury giant’s management

Alexandre Arnault, a son of LVMH MC 1.90%increase; green up pointing triangle Chairman Bernard Arnault, is stepping into a senior management role at the group’s vast wines-and-spirits business, a move that advances the 32-year-old executive’s position as a contender to one day succeed his father at the helm of the world’s largest luxury conglomerate.

The younger Arnault is slated to return to France as the deputy chief executive of the group’s Moët Hennessy division after spending three years in New York as the No. 2 executive at jeweler Tiffany & Co. He will become the first of the five Arnault children to hold a senior role in the wines-and-spirits business, a cornerstone of his father’s luxury empire.

Alexandre Arnault will report to Jean-Jacques Guiony, the former CFO of LVMH, who is also moving to the wines-and-spirits unit to become its CEO. The moves are part of a broader realignment across LVMH’s senior ranks that has replaced some of Bernard Arnault’s longest-serving lieutenants with younger executives.

Guiony is expected to work in tandem with Alexandre Arnault with the aim of eventually handing him the reins of the wines-and-spirits business, according to a person familiar with the matter.

“I’m excited to step into a new chapter,” the younger Arnault wrote on X, adding that he was “embracing this foundational part of our Group’s heritage.”

A show staged by LVMH’s Louis Vuitton brand at Paris Fashion Week in January. PHOTO: GETTY IMAGES

The move distinguishes Alexandre Arnault from the luxury titan’s other children, who have mainly worked in LVMH’s fashion-oriented businesses. It is also likely to rekindle chatter throughout the salons of Paris over who among 75-year-old Arnault’s children is best suited to succeed him.

Delphine Arnault, 49, Arnault’s eldest child from his first marriage, is CEO of Dior, while her brother Antoine, 47, is chairman and CEO of Christian Dior SE, the holding company through which the Arnault family controls LVMH. Arnault’s children from his second marriage include Alexandre and his younger siblings Frédéric, 30, who runs LVMH’s jewelry-and-watches division and Jean, the youngest son, who heads Louis Vuitton’s watch business.

Alexandre Arnault is moving to a unit with sprawling operations—from Champagne vineyards and cognac distilleries to a large, unionized workforce—that require more hands-on management than many of LVMH’s fashion houses. The division also boasts an array of brands, including the Chateau d’Yquem sweet wine and Veuve Clicquot Champagne, that will provide Alexandre Arnault with a preview of what it is like to run a conglomerate with more than 70 brands.

The business is also facing serious headwinds. The wine-and-spirits division recorded the sharpest drop among LVMH’s divisions when the conglomerate reported third-quarter sales that missed market expectations.

Champagne sales were initially hit by the Covid-19 pandemic, but sales roared back as consumers emerged from lockdowns ready to party with bubbly and other booze. That celebratory mood has since faded.

Sales of cognac meanwhile have been declining in its two most important markets: the U.S. and China. Beijing also recently imposed temporary antidumping levies on European Union brandy as it weighs whether to move forward with more lasting tariffs.

Write to Stacy Meichtry at Stacy.Meichtry@wsj.com and Nick Kostov at nick.kostov@dowjones.com