The serial entrepreneur is no longer the richest man in the world.
It’s a big clap of thunder that has just occurred in the closed club of the biggest fortunes of the planet.
Some would even say it’s a big bang: Elon Musk, the man whose personal fortune once soared to $340 billion, is no longer the richest man in the world. He has just lost this prestigious title and crown.
The new king is French businessman Bernard Arnault, CEO of luxury group LVMH. Arnault took power on December 13 at the close of Wall Street. Indeed, the decline of Tesla stock allowed him to pass in front of the CEO of the manufacturer of electric vehicles.
Arnault’s fortune is now estimated at $171 billion, compared to $164 billion for Elon Musk, 51, according to Bloomberg Billionaires Index.
Arnault, 73, had already passed Musk in the Forbes ranking a few days ago. In this ranking, his net wealth is estimated at $188.6 billion, while Musk’s is valued at $176.8 billion.
The fortune of the two men is based on their participation in their respective companies. Arnault owns 48% of fashion and luxury giant LVMH. Musk currently owns 14.11% of Tesla’s Outsanding shares, according to FactSet. He also has a more than 40% stake in SpaceX.
Musk’s Net Wealth Is Down $107 Billion in 2022
The difference between Arnault and Musk is played out in the fact that in a dark year for the equity market, the LVMH share has held up quite well, falling only 1.5% in 2022. This is the complete opposite of the Tesla stock, which is down 54.3%.
This stock market crash in the value of Tesla stock was a huge contributor to the fall in Musk’s fortune. In 2022, his net worth fell by $107 billion according to Bloomberg Billionaires Index, making him one of the biggest losers in the billionaire rankings. By comparison, Arnault saw his fortune drop by just $7.2 billion.
Musk became the richest man in the world in September 2021. His reign therefore lasted in total around 15 months. Its fall coincides with the liquidation of technology stocks on the stock market due to fears of recession.
In addition, since the tech mogul made his $44 billion bid to acquire Twitter, the electric vehicle maker’s shares have steadily fallen in value. That’s because investors worry that the social network will distract him, when Tesla faces fierce competition from Chinese and legacy automakers.
The resurgence of covid-19 in China, and fears surrounding the tech sector in an inflationary environment also pose challenges for Tesla.
The luxury sector is relatively impervious to the economic slowdown and recession concerns, which benefits LVMH, which owns several global brands such as Dior, Louis Vuitton, Tiffany, Sephora etc.
LVMH reported stronger-than-expected third-quarter sales last month, as wealthy customers flocked to its fashion brands and Americans took advantage of the strong dollar to visit its stores in Europe.
Demand for luxury goods remains resilient in the face of sharp inflation. Affluent consumers have been less affected by the higher cost of living, while the average consumer has cut back on discretionary spending.
Third-quarter revenue for the owner of Louis Vuitton and Dior amounted to 19.76 billion euros ($20.29 billion), reflecting organic growth (excluding acquisitions) of 19% from a year earlier.
Big Tech Remains Well Represented in the Top 10
Sales in Europe, the U.S. and Japan have risen sharply this year due to solid demand from local customers and the resumption of international travel.
The Indian executive Gautam Adani is the world’s third-richest person, with a net worth of $125 billion, up $48.6 billion since January, according to the Bloomberg Billionaires Index.
Amazon (AMZN) – Get Free Report founder and Executive Chairman Jeff Bezos is fourth with $116 billion, down $76.6 billion since the start of the year. Microsoft (MSFT) – Get Free Report co-founder Bill Gates is the fifth-richest person in the world with a fortune estimated at $116 billion. His wealth has shrunk by $22.5 billion in 2022.
The top 10 include three other tech tycoons: Larry Ellison, co-founder of Oracle (ORCL) – Get Free Report, has a fortune of $92.9 billion, down by $14.2 billion. He’s ranked seventh. Steve Ballmer, former CEO of Microsoft, is 8th with a fortune of $90.7 billion, down by $14.9 billion. Larry Page, co-founder of Alphabet (GOOGL) – Get Free Report, is tenth with $88.8 billion, down by $39.6 billion.
The legendary investor Warren Buffett is the sixth richest person in the world. He is worth $108 billion, down by $456 million.
And the Indian billionaire Mukesh Ambani is ninth. His fortune is estimated at $89.7 billion, down $276 million since January.