LVMH chief executive Bernard Arnault has promoted his daughter Delphine to run fashion brand Dior as part of a reshuffle at the world’s largest luxury group.
The management changes announced on Wednesday also see rising star Pietro Beccari, who has run Dior since 2018, named the new chief executive of LVMH’s flagship brand Louis Vuitton.
The moves are the latest in a burst of planning from the 73-year-old Arnault, who is looking towards the leadership succession at the group he built into the most valuable company in Europe.
Beccari will next month succeed veteran executive Michael Burke at Louis Vuitton, who has turned the luggage and handbag maker into a powerhouse that accounts for almost two-thirds of LVMH annual operating profit.
Beccari has also had a strong run at Dior, LVMH’s second biggest brand, where he has helped treble annual sales to about €10bn in only four years, and vaulted the Paris-based house into the top ranks of luxury brands in terms of sales and growth.
Delphine Arnault, the eldest of Arnault’s five children, will take over as the chief executive of Dior after having been the number two at Louis Vuitton since 2013.
Three of Bernard Arnault’s sons, Antoine, Alexandre, and Frédéric, have executive roles within the group.
From a governance point of view, another important change was made this summer at the family’s holding company Financière Agache, which holds a 48 per cent stake in LVMH. It turned Agache into what is known as a société en commandite, a distinctive legal status in France used by a handful of family-owned companies such as Hermes and Michelin to help protect them from takeover.
The move was also seen as a way to facilitate the future governance within the family and organise the ownership in the coming decades among the five heirs and their descendants.
Thomas Chauvet, luxury analyst at Citi, said: “Succession planning in strategic roles has been instrumental to the success of LVMH’s key brands over the past 20 years, hence today’s management changes are significant.”
The changes come as LVMH has to date enjoyed resilient demand for its high-end handbags, watches and fashion even as the global economy slowed last year. Its shares slumped 7 per cent in 2022 amid a sell-off in global equities, compared with a 10 per cent drop for the sector.
But the reopening of the Chinese market, the second-biggest for luxury in terms of sales after the US, that began in December when strict Covid-19 controls were lifted is expected to support luxury sales next year.
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2023-01-11 10:00:41Z
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