Bernard Arnault, CEO of luxury group LVMH, plans to visit China later this month. From new contracts to brand development, LVMH has stepped up its activities on Asian soil since the end of restrictions, particularly in China. Bernard Arnault, who works closely with the world’s second largest economy, is keen to strengthen the Group’s presence and influence in Asia.
Business trip in prospect. LVMH chairman Bernard Arnault is set to visit China, two sources told Reuters on Thursday, as European luxury goods manufacturers closely monitor the pace of recovery in this key market after three years of disruption due to the COVID crisis.
One of the sources close to the matter said that Arnault’s visit to the all-important Chinese market will take place later this month.
This announcement comes on the heels of last week’s high-profile visits to the country by JPMorgan Chase & Co CEO Jamie Dimon and Tesla CEO Elon Musk. The latter was on a business trip. He was received by the Minister of Foreign Affairs, Qin Gang, the Minister of Commerce, Wang Wentao, and the Minister of Industry, Jin Zhuanglong. A visit worthy of a head of state.
The sources did not give the reason for the trip or specify where Mr. Arnault was likely to visit in the country. LVMH, which owns a range of brands from cosmetics to wines and spirits, declined to comment.
China open for business
This visit appears to be the logical next step in a context favorable to business negotiations and exchanges. The Chairman and CEO of LVMH met China’s Minister of Commerce, Wang Wentao, in Paris last April, at Christian Dior’s flagship store on Avenue Montaigne. The meeting underscored the continuing dynamism of LVMH companies in China, as well as the long-standing and close ties between the two partners. The meeting was attended by Mr. Arnault’s daughter, Delphine Arnault, CEO of Dior, and other senior LVMH executives. The group has pledged to participate in the China International Import Expo, to be held in Shanghai in November.
The Chinese authorities were keen to stress that the country has been open for business since the lifting of restrictions in December. The recovery was uneven, but the luxury sector outperformed other categories, as affluent consumers maintained their habits on the mainland.
China’s rebound helped boost LVMH’s first-quarter sales, which rose by 17%. More generally, in the first three months of the year, its sales rose by 14% in Asia, excluding Japan, following an 8% decline in the fourth quarter of last year. The luxury leader said it expected China to drive growth in 2023. LVMH expected to generate 27% of its sales in 2022 in the Americas and 30% in Asia excluding Japan.
LVMH active in China
Mr. Arnault’s planned visit comes at a crucial time for LVMH, which has bought American jeweler Tiffany, its biggest acquisition to date, and is looking to expand in China as part of a strategy to catch up with arch-rival Cartier.
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Featured photo : © Magali Delporte
