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LVMH will become a top sponsor of car racing franchise Formula One as the leading luxury group pushes further into the world of sport.
The agreement will start in 2025 and run for a decade, LVMH said on Wednesday. The deal is worth just under €100mn per year, according to two people with knowledge of the arrangement.
It will involve several of Bernard Arnault’s luxury empire’s top brands including Louis Vuitton, the world’s biggest luxury brand by sales, drinks division Moët Hennessy and watchmaker Tag Heuer.
The deal was led by Frédéric Arnault, the second youngest of the billionaire patriarch’s five children, who was promoted to head LVMH’s watchmaking division at the start of the year.
He was previously chief executive of Tag Heuer and is a graduate of France’s top engineering school Ecole Polytechnique, like his father.
“The opportunity to scale our commercial arrangements is emblematic of the vision we have for Formula 1 as the business continues to grow . . . We look forward to working with Bernard and Frédéric Arnault in the years to come,” said Greg Maffei, president and chief executive of Formula 1 owner Liberty Media.
Luxury groups have increasingly targeted sports to grow their audience and popularity. While luxury has long been associated with elite sports like show jumping and tennis, links with more mainstream sports like basketball and football are becoming more frequent.
The French group’s deeper foray into the world of racing follows its high profile sponsorship of the Paris Olympics, where bars flowed with Moët Hennessy drinks and athletes were awarded medals made by LVMH-owned jeweller Chaumet.
However, a several minutes long sequence in the opening ceremony centred around monogrammed Louis Vuitton trunks raised some eyebrows as sponsors pushed into previously ad-free spaces in the global sporting event.
Earlier this year LVMH launched a new Louis Vuitton ad campaign featuring tennis stars Roger Federer and Rafael Nadal hiking in the Italian Dolomites. It was a new iteration of a 2022 campaign featuring footballers Cristiano Ronaldo and Lionel Messi playing chess.
Formula One, meanwhile, has been on a years-long push into new markets and new audiences. Since US-based Liberty Media acquired it for $8bn in 2017, the racing calendar has expanded to flashy locales in Miami and Las Vegas, and Netflix docu-series Drive to Survive has helped boost viewership.
The share of female F1 fans has risen to 40 per cent, from 32 per cent in 2018, helping to attract women-focused sponsors. Earlier this year, Charlotte Tilbury cosmetics debuted the first sport sponsorship of its own with the F1 Academy.
All five Arnault children have operational roles within family-controlled LVMH. All except the youngest, Jean, have seats on the group’s board. Frédéric and Alexandre, an executive at jeweller Tiffany, joined their siblings on the board earlier this year.
Additional reporting by Sara Germano
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