What is up, what is down, and where is the luxury market going? As usual, conflicting reports, a little spin and some frankly bizarre occurrences keep the luxury market as entertaining as ever.

The Independent, a British Newspaper that could best be described in American terms as “left wing libertarian,” reports that “Luxury Yacht makers get that sinking feeling,” after a two-year-old Manhattan 66 yacht failed to sell after being heavily discounted and offered at a special reception in Canary Wharf, London. The yacht would normally sell for around $2.5 million, but remained unsold after the manufacturers offered a substantial discount of $200,000.

A slashed bonus is one thing; a depleted expense account another. But, even in these times of strife and slimmed-down pay packets, what self-respecting City hotshot can be expected to do without a yacht?

The prospect of credit crunch belt-tightening hitting yet another of the staples of the super-rich lifestyle was raised yesterday as luxury yacht makers admitted that discounts are now available. Full story.

Although I get the feeling this is more a case of wishful thinking on behalf of the Independent’s editor who must have lost his shorts in the sub-prime fiasco. One failed-to-sell yacht does not a disaster make. And if anyone is interested, I have a friend in Spain with a three-year-old for sale and I know he would happily take less than this.

On a slightly more bizarre note, Donald Trump appears to think that nothing says luxury quite like watching two 300-lb men beat the crap out of each other in a cage. Mixed Martial Arts Online recently announced a new partnership between “Affliction,” who describe themselves as “the premier fashion label for men who love hard rock and fast living,” and Mr. Trump with their first event, “Affliction Banned,” on pay per view on July 19th.

At a press conference held in Trump tower, Mr. Trump said:

This particular sport resembles my business style of being fast paced, strategic, and aggressive…remembering to never give up. I am particularly excited to partner with Affliction and become a major player in promotion of MMA; the youngest and fastest growing sport to emerge in the last century.

Mr. Trump is rapidly becoming my favorite quotable person and other news to come out of the conference was the return to competition of Fedor “The Last Emperor” Emelianenko, who will be headlining alongside Andrei “The Pitbull” Arlovski, “Big” Ben Rothwell and Tim “The Maine-iac” Sylvia. I am stopping there in case I upset the wrong people. Full story here.

Back across the pond to the UK, the “Environmental Transport Association,” (ETA) announced the “Most Expensive bicycle in Britain,” a $19,000 gold-plated, custom made fixed-wheel that comes with the optional accessory of a security guard to watch over it when it is left in public.

With less than 10 days before the start of Green Transport Week, it is believed the bike may be bought by a ‘cyclist who has everything’.

Director at the ETA, Andrew Davis said: “A personal security guard is not a practical option for most people, but with over half a million bicycles stolen across Britain each year, it’s vital that cyclists are properly insured.” Full story

It might actually be the most expensive bike in Britain, but it pales in comparison with Lance Armstrong, whose charity, The Lance Armstrong foundation, sold a jewel encrusted, gold plated Trek Madone 5.9 SL back in 2005.

Maîtres du Temps, master watchmakers, announced their new Chapter One in Geneva recently. The watch features “a tourbillon with mono-pusher column wheel chronograph, retrograde date, and retrograde GMT, as well as moon phase and day of the week on their own rolling bars.” I don’t even know what that means. 558 components and a price tag of $400,000, I do understand. According to their sales brochure:

The level of technical and design sophistication achieved by Maîtres du Temps has rarely been seen in watchmaking and is the result of the right combination of people sharing a bold vision.

Just in case you missed it, that is four hundred thousand dollars. For a wrist watch. Ouch….

Maîtres du Temps

It would appear that the luxury market for champagne is as robust as ever with a recent announcement from Veuve Clicquot.

Staying in Europe, but coming down the price scale just a tad, French champagne maker, Veuve Clicquot, announced a design collaboration with luxury yacht manufacturer, Riva to produce the “cruise collection,” a craftsmen-produced champagne cooler. Riva, who make possibly the sexiest speedboats on the planet use traditional materials such as mahogany wood, chrome and leather with traditional boat making techniques to produce these beautiful coolers. The “cruise collection,” is made to measure and comes complete with four bottles of Veuve Clicquot :”La Grande Dame ’99, 2 magnums of La Grande Dame ’88, 6 champagne flutes, 6 water tumblers, plates, table mats and cutlery. Price - $80,000. A bargain compared to the watch Veuve Clicquot

It would also appear that the luxury market for champagne is as open to abuse as all other markets as the message received when entering the Veuve Clicquot website is this

Dear websurfer,

A promotional deal is currently on the ‘net regarding a free offer of a case of 6 bottles of Veuve Clicquot champagne.

This is a hoax, totally beyond our control; and of course, we are not the author. We do not gather any e-mail nor build up any database.

We strongly condemn the author of this hoax and hope that it will end.

Yours sincerely,

Veuve Clicquot Ponsardin

This is a very French reaction. Customer service? Pas possible! Caveat Emptor

Heading East, Reuters report that luxury goods makers are shooting themselves in the foot by producing goods with a “Made in Asia,” label, and a Chinese customer in China was incensed to discover that genuine Armani is actually made in China, but the fakes say “Made in Italy.”

The makers are, of course trying desperately hard to persuade consumers that cost-cutting by moving manufacturing plants to countries where child slave labor is readily available is actually a step up.

“At the end of the day, we are talking about perception. There is no reason why you can’t make good things anywhere in the world, as long as you have the artisans and attention to quality,” said John Hooks, deputy managing director at Giorgio Armani.

Good luck with that. Full story.

Time magazine and F. Scott Fitzgerald seem to think that luxury retailers are making another big mistake by not offering more of their products online.

That reticence is a big mistake, Forrester says, because the growth in online sales shows no signs of easing. In Europe alone, total online sales should rocket 63% from an estimated $246 billion this year, to $401 billion in 2011, it predicts. In the U.S., total sales are expected to soar 93% from last year to $335 billion in 2012. Premium brand companies that are selling online expect their total sales to jump 111% within five years, by which point they will account for 22% of total sales.

While at the same time (sic) accusing luxury brands of “jumping on the e-commerce bandwagon.” Make your mind up guys. If Armani can convince people that making T-shirts in obscure far Eastern countries is a step up in the luxury world, you have to give them some credit. Full story.

Over in Australia, luxury car dealers are confused as to whether or not they should start charging a new luxury tax because of conflicting advice coming from the Australian Taxation Office. The Australian reports:

The Government increased the tax on luxury cars worth more than $57,000 from 25 per cent to 33 per cent in its May budget, but last Wednesday the Senate refused to pass legislation implementing the change, instead referring it to a committee that will not report until late August.
The tax office told Federal Chamber of Automotive Industries chief executive Andrew McKellar last Thursday that the tax would be collected retrospectively - backdated to July 1 - after the legislation eventually made it through the Senate. Full story

All in all, an entertaining start to the luxury week.