Tough times for global wine and spirits giant

Times are tough in the drinks business right around the world. 

Global wine and spirits giant Moët Hennessy will cut more than 10% of its global workforce as part of a major restructuring effort in a bid to counter falling demand and rising costs, the Financial Times reported in London..

The newspaper says the wine and spirits arm of luxury giant LVMH currently employs around 9,400 people. Chief executive Jean-Jacques Guiony told staff earlier this month that an estimated 1,200 roles would be eliminated, bringing the division back to its 2019 staffing levels.

Revenues at Paris-based Moët Hennessy have fallen to 2019 levels, Guiony said, yet operating costs have jumped 35% over the same period. 

“This was an organisation that was built for a much larger size of business,” he said in an internal video. 

“People realise … that this [rebuilding sales] is not going to happen anytime soon.”

The cuts will largely be achieved through natural attrition and by reassigning staff to other areas of the business. Moët Hennessy has already implemented a hiring freeze. 

Deputy CEO Alexandre Arnault, who joined the division alongside Guiony in February, told staff that this crisis was unusual in scope. 

“Usually at LVMH when wines and spirits are not going well, fashion is doing well or some [other part of the business] is performing differently. Right now things are not going extremely well,” he said.

In a statement, a Moët Hennessy spokesperson confirmed the planned cuts. 

“While Moët Hennessy’s business has returned to its 2019 level, Moët Hennessy announced its intention to adjust its organisation and gradually return to its 2019 staffing levels, primarily by managing its natural turnover and not filling vacant positions,” it said.

Guiony reassured staff that the current downturn was part of a cycle. 

“Things are bad but they will become better,” he said, though he warned that US tariffs added another layer of uncertainty to the company’s outlook.

The company's wine and spirit brands include Krug, Hennessy, Dom Perignon, Moët et Chandon, Chateau Cheval Blanc, Ardbeg, Belvedere Vodka, Chateau d'Yquem, Ruinart and Cloudy Bay and Glenmorangie.

LeBron spruiks a special-edition cognac

Meet the new limited-edition cognac that being promoted by veteran NBA star LeBron James.

Cognac house Hennessy has revealed a new collab with LeBron for a special design of its VS “Very Special” bottle.

The limited edition bottle design will be available globally this week, drinks business reports.

James called himself an “admirer of Hennessy and its iconic brand”, saying he has “always appreciated its commitment to basketball and how it celebrates the sport’s influence on and off the court.”

I hadn’t noticed myself but db reports that LMH-owned Hennessy has regularly aligned itself with the sport and its fans.

In October 2023, the brand extended its contract as the official spirit of the NBA.

To mark the renewal, the cognac maker released limited-edition bottles co-branded with the NBA and unveiled a series of basketball courts in recognisable settings worldwide, including a floating version on the River Thames in London.

Partnerships with basketball players help cognac houses raise their profile in North America, a market in which the category is struggling. In recent years cognac has seen sharp decline of sales in that market, which accounts for 40% of global sales.

And sales in the US are becoming evermore central to distillers’ export strategy, as China, the category’s biggest market, threatens has threatened imposing tariffs.

Both the bottle and gift box highlight an illustration of James in purple and orange. The Hennessy Bras Armé is reimagined on the limited- edition packaging, sporting a sleeve as a tribute to James and intertwined with his trademark crown.

The blend will remain the same.

Antoine Varlet, senior vice president, Hennessy US, said: “We are elated to officially welcome LeBron James to the Hennessy family after many years of mutual admiration and friendship. 

"LeBron is not just a basketball star, but someone who redefines boundaries in sport, style, culture and beyond.”

James loves his spirits. He is also an investor in Lobos 1707 Tequila.