Is tide turning for London's prodigal plutocrats?

Tue Jan 24, 2012 2:56am EST
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Michelle Martin

LONDON (Reuters) - London's super-rich, their numbers swelled by fat cats from China, Russia and the Middle East, are spending more on luxuries than before the financial crisis, but there are signs that some may be cutting back on the cream.

The global luxury goods market grew 10 percent to 191 billion euros ($249 billion) between 2010 and 2011, surpassing the 2007 peak of $170 billion on the back of strong appetite from Chinese customers, data from consultancy Bain & Co shows.

"From what we're finding, despite global events, luxury is really experiencing almost an anti-crisis," Tory Frame, a consumer products and retail expert at Bain, told Reuters.

At the very top end of the luxury sector, a long waiting list for private jets is evidence that London's super-rich have so far proved immune to the downturn.

David Dannreuther, a London-based partner at law firm Withers who helps super-rich clients purchase private jets, said demand was as high as ever, with typically three to five private plane deals valued at up to $50 million a year.

One of these transactions was the purchase of a jet for a family who no longer wanted to subject their dog to the indignities suffered by pets on commercial flights.

Further down the scale, boating enthusiasts were splashing their cash at the London Boat Show, despite consumer morale in Britain sinking to its lowest in almost three years in December, as the country grapples with high inflation, slow wages growth and the highest level of unemployment in 17 years.

"The super-rich are still super-rich -- they're just a little bit less super-rich. But there's still demand for larger and larger boats like the Sunseeker 28, which was launched at this show," said Michael Enser, head of marketing at the British Marine Federation.   Continued...

<p>A woman exits the Louis Vuitton shop on New Bond Street, renowned for its jewelry and designer retailers, in London August 24, 2009. REUTERS/Luke MacGregor</p>