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Bernard Arnault surpassed Elon Musk as the richest man in the world, according to Forbes.
Elon Musk is no longer the richest man in the world.
That job now goes to Frenchman Bernard Arnault, chief executive of luxury goods group LVMH.
According to Forbes magazine and the Bloomberg agency, Musk’s fortune suffered from a sharp drop in shares of his Tesla electric car company this year.
In addition to being Tesla’s chief executive and major shareholder, with a nearly 14% stake, Musk also invested in the $44 billion purchase of Twitter in October.
Forbes estimates Musk’s current net worth at $178 billion.
as long as Bernard Arnault’s fortune is valued at $188 billion.
Bernard Arnault’s empire
French tycoon Bernard Arnault is the founder, CEO and largest shareholder of the largest luxury goods group LVMH, also known as Moët Hennessy Louis Vuitton, with its headquarters in Paris.
LMVH has a total of 75 luxury brands, 163,000 employees (2020 data) and a network of more than 4,590 stores worldwide. Among the many other brands in the group are Bulgari, Kenzo, Tag Heuer, Dom Pérignon, Möet & Chandon, Hermès and Christian Dior.
In early 2021, following a year of negotiations complicated by the pandemic, LVMH bought the legendary American jeweler Tiffany & Co, giving Arnault a bigger slice of that growing sector of exclusive jewelry.
Since then, the multinational conglomerate has set out to increase its presence in the online sales market and raise its profile among younger consumers and customers in China.
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LVMH is concentrating its efforts on reaching young customers and the market in China.
Fortune, patronage and controversy
Bernard Arnault’s professional life began in 1971 in his father’s construction and public works company, which he refocused on the real estate market and then assumed its general management in 1978.
After a million-dollar investment in a group that includes the textile division of Christian Dior, he became executive president of that company in 1985 and later managed to consolidate perfumes with haute couture in the Christian Dior SA holding company, which among its subsidiaries includes to LVMH.
In 1987, he bought LVMH shares and in the following years launched a ambitious plan for the expansion of the group that will make it the number 1 in luxury items.
In 2013, Forbes magazine estimated his fortune at US$29 billion and in 2019 it had already reached US$100,000, making him the richest man in France. Now, in 2022, the same magazine places it in the first global position in personal wealth.
Arnault is an art lover and collectorand has works by artists such as Basquiat, Hirst, Warhol and Picasso.
It has enhanced the image of the LVMH group as an agent of patronage in France and created an international prize to support young creators. For her “stunning generosity” she received the David Rockefeller Award from the Museum of Modern Art in New York.
But LVMH has not been without controversy. The Christian Dior brand was forced to fire its designer John Galliano for alleged anti-Semitic statements and the group was also linked to a case of discrimination and harassment of women within the Prada brand.
In December 2021, LMVH paid a demand of 10 million euros (US$12.2 million at current exchange rates) following allegations that a former French intelligence chief hired by the company had spied on competitors and the producers of a documentary on Arnault’s life.
What happened to Elon Musk?
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The main factor in the reduction of the fortune of Elon Musk is in the fall in the value of his flagship company Tesla.
Musk was involved in an arduous legal fight to close his purchase of the social network Twitter, and some have pointed out that that distraction contributed to Tesla’s stock plunge.
After stockpiling shares in Twitter earlier in the year, Musk made his $44 billion offer in April, though observers considered it too high.
In July, it withdrew the offer, citing concerns regarding the number of fake accounts on the platform.
Ultimately, Twitter executives sued the mogul to make him honor his purchase promise.
Dan Ives of investment firm Wedbush Securities said that the “circus” that formed around the purchase of Twitter put pressure on Tesla shares.
“Musk has gone from superhero for Tesla shares, to villain in the eyes of Wall Street, as the slide deepens with each tweet,” he told the BBC.
“The Twitter circus show has damaged the Musk brand and is a huge drag on Tesla’s assets. Musk is Tesla and Tesla is Musk.”
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In November 2022, Tesla had to recall 321,000 cars with software problems.
Musk sold billions in Tesla stock to finance his purchase of Twitter, helping to drive down the electric car company’s value.
Investors are also wary of a slowdown in demand for company electric carsas the economy weakens, the cost of credit for buyers increases and the other competing companies push their own range of electric vehicles.
Tesla has also been affected by car recalls due to failures, in addition to government investigations of accidents and problems with the autopilot system of the vehicles.
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