UK Edition
Champagne stocks risk running out before Christmas, the boss of one of the world’s biggest producers has warned, as Americans take advantage of the strong dollar to snap up bottles of French fizz.
Philippe Schaus, chief executive of Moët Hennessy – whose brands include Veuve Clicquot, Dom Périgno and Moët & Chandon – said his company was "running out of stock" at a press conference in Singapore on Tuesday, raising the spectre of shortages over the festive season.
Mr Schaus said demand was so strong that his company was calling it the “roaring 20s”. American customers have capitalised on the comparative strength of the US dollar to snap up bottles of bubbly.
The comments raise the spectre that families will be forced to raise a toast with alternative sparkling wine over the festive season. Jean-Jacques Guiony, finance chief of LVMH, Moët Hennessy's parent company, has previously warned that stocks may not last until Christmas.
He said in October: “We still had bottles available, which will not necessarily be the case in [the fourth quarter].”
He said champagne sales were “very strong” in Europe and “above all, in the U.S., where we had a very strong quarter.” LVMH, France’s biggest listed company, has benefited from the weak euro compared with the US dollar, which makes its goods cheaper in real terms for American shoppers.
Mr Schaus said demand for champagne had not been dampened by a global squeeze on household budgets. Luxury goods sold by LVMH have thus far proved immune to soaring inflation and stagnating economic growth.
Consultants at Bain & Company estimate that the luxury goods market will grow by up to 8pc in 2023, despite an expected global downturn. Growth is being driven by younger generations, with millennials, born in the early 1980s, and Gen Z, those aged between eight and 23, accounting for all the growth in the luxury market in 2022, Bain said.
The consultancy added: “Spending of Gen Z and Gen Alpha [born between 2010 and 2024] is set to grow some three times faster than for other generations until 2030, making up a third of the market.
“This is, in part, driven by a more precocious attitude towards luxury, with Gen Z consumers starting to buy luxury items some 3 to 5 years earlier than Millennials – at 15 years-old, versus at 18-20 – and Gen Alpha expected to behave in a similar way.”