Although he has never run a company in the luxury sector, Luca de Meo is no novice in this field. The businessman has a keen taste for fine things, particularly Swiss watches.

Luca de Meo is also, and above all, a specialist in complicated situations. He has proven himself in the field of corporate restructuring. In particular, he held brand management positions within the Fiat group in the 2000s, where he helped revive the iconic Fiat 500. He then gained solid marketing skills at Volkswagen. Then, at the worst moment of the 2020 global pandemic, he took the helm at Renault. The French carmaker was emerging from several years of losses, both in terms of revenue and margins.

Luca de Meo managed to turn the tide, even though the task was far from easy given the level of inflation, interest rate hikes, the arrival of cheaper vehicles, and the transition to electric vehicles.

The Renault boss relied on a three-phase plan called Renaulution. The first part, Resurrection, from 2021 to 2023, served to restore profitability by reducing costs, optimizing production capacity, and focusing on the most profitable models. The second phase, Renovation, aimed to renew and enrich the range, with an emphasis on moving upmarket and innovation. The return of the R5 in an electric version and of Alpine, both on the road and in Formula 1, are among the best examples of the desire to revive iconic models. The third pillar of the plan will therefore be implemented without Luca de Meo. Named Revolution, the goal is to transform a group that has been put back on track into a technology company focused on electrification and connected services.

Luca de Meo is therefore leaving with a light heart. Much of the work has been done, and he is leaving the manufacturer in a much better position than when he arrived five years ago. This is especially true given that he managed to extricate the group from the trio that had become a liability with Nissan and Mitsubishi. He succeeded where traditional methods no longer worked.

The task at Kering will be just as complex. The luxury sector is sluggish. Only timeless brands that are protected from concerns about rising prices (Hermès, Brunello Cucinelli, and a few at LVMH) are managing to stay afloat. But overall, falling Chinese demand and the threat of tariffs are affecting the sector. At Kering, the situation is all the more delicate as the Pinault family has failed to restore the image of the main brand, Gucci, which accounts for 45% of sales and two-thirds of profits. Various management upheavals and rising debt have not helped to clarify the picture over the quarters. The stock has lost nearly 80% of its value since its August 2021 highs.

The challenge will therefore be daunting for a man who has worked in the automotive industry all his life. But few in the market are as well equipped as he is to take the helm of such a struggling company. Marketing and brand management are his strengths, and these are particularly relevant to Kering.

This explains the enthusiastic reaction to the stock, which gained nearly 12% on Monday.