The theme of this blog is “Culture Justly Scrutinized,” and nothing acts as a barometer of culture quite like the ebb and flow of luxury items. Curiously, a lot of activity has taken place in the past several days with luxury brands. Here is a brief review:
Fiat Splits off Ferrari
Last month, Ferrari – which is wholly owned by Fiat Chrysler – announced the departure of Luca Di Montezemolo who was the sports car maker’s chairman for 23 years. Many reasons for Montezemolo’s resignation were floated, but the one that seems most pertinent is that Ferrari’s Formula 1 team hasn’t won a championship since 2008. For those familiar with the fabled luxury brand, it was Enzo Ferrari who founded the company in 1947 to produce race cars – a costly venture that would be funded by the sales of derivative road vehicles. The race cars would showcase the road cars, and sales of the road cars would fund the racing division. In short, racing – and winning – has always been the key part of the business model.
Fiat Chrysler chairman Sergio Marchionne indicated that Ferrari was too important to the parent company to ignore the troubles.
Montezemolo steps out of Ferrari – in more ways than one.
Then just the other day Fiat Chrylser, after repeatedly voicing commitment to the Ferrari brand, announced they would be spinning it off instead, ahead of a major IPO. So much for the headaches of running a specialty brand that produces 6,500 gorgeous cars a year inside a behemoth company that cranks out 4.5 million boring ones annually.
Patek Philippe Celebrates 175 Years
High-end wristwatches have long been a symbol of wealth, taste and heritage. Although the category is awash in top brands – Cartier, Bulgari, Audemar-Piguet, Baume & Mercier, A. Lange & Sohn, Ulysse Nardin – it may be argued that the grand-daddy of all luxury wristwatches is Patek Philippe. With the advertising slogan, “You never actually own a Patek Philippe. You merely look after it for the next generation,” Patek seeks to establish the notion that their watches belong to the ages. And given the prices, one can understand why an owner would never consign his watch to a dusty drawer to be lost after a couple of household moves.
The Grand Complications Perpetual (5270G-013) goes for $160,000 new, the Grand Complications Perpetual Calendar Moonphase Chronograph (5004R-014) is $236,000, and the Grand Complication Tourbillon Perpetual (5207R-001) will set you back around $850,000.
Now on the 175th anniversary of the founding of the company, Patek announced last week the offering of the Grandmaster Chime (5207R-001), a double-sided watch with 20 complications and a price tag of 2.6 million Swiss Francs (about the same in dollars). Only seven watches will be made, one of which will be consigned to the Patek-Philippe museum in Geneva.
How is it possible a wristwatch could cost $2.6 million? Well, if you have to ask . . . but since you did, watch the fascinating and lovely movie detailing its creation from precious metal blanks to finished product.
Steinway Moves to New Digs
Founded in 1853, Steinway & Sons has long been the premier makers of fine pianos, played by virtually all noteworthy pianists in the most prestigious concert halls of the world. In 1925 they opened their flagship New York store called Steinway Hall at 109 West 57th Street in a grand, three-storied building down the street from Carnegie Hall. The Hall, which serves as both showroom and concert facility, has since been the site of countless performances by famous virtuosos like Vladimir Horowitz and Sergei Rachmaninoff.
Now, Steinway is making the move to new digs after having sold the building for $195 million a couple years ago. (Management also sold the company around the same time to billionaire hedge-funder John A. Paulson.) Steinway will take over space currently occupied by the International Center for Photography (ICP) at 43rd and 6th in a fifteen-year rental agreement.
Somehow, the move seems to diminish the standing of Steinway. And given the company is in the hands of a hedge-fund manager in a period where inexpensive digital keyboard products have cut into the business of selling classic stringed instruments, it doesn’t come as a surprise.
LVMH Opens a Fabulous Paris Store
Architect Frank Gehry continues to be the go-to guy for stylish and stunning museums. Added to his lengthy list of clients – Guggenheim Bilbao, Guggenheim Abu Dhabi, Vitra Design Museum, Weisman Art Museum – is LVMH, the huge purveyor of luxury brands that include Louis Vuitton, Moët & Chandon, Fendi, Hublot, Dom Pérignon, and Dior among dozens of other major labels.
Several years ago LVMH chairman Bernard Arnault conceived the notion of creating a museum-like showcase of the conglomerate’s seminal and influential products. Now, this month, Fondation Louis Vuitton opens in Paris’s Bois de Boulogne – a $143 million, 126,000 square foot homage to the finer things in life.
Paris has had a rocky relationship with modern architecture, largely seeking to maintain the status quo of Napoleonic elegance against brash new ideas. The inclusion (intrusion?) of glass pyramids at the Louvre by noted architect I.M. Pei caused a major stir at the time of installation. And Gehry’s design for Fondation Louis Vuitton garnered like-minded loathing by Parisians who saw the asymmetric sail-like glass-and-titanium structure as an affront to the sensibilities of the Bois de Boulogne.
Still, luxury talks. And LVMH has raised a stunning edifice to itself.
Renzo Rosso Makes a Risky Hire
Renzo Rosso, the billionaire owner of Diesel, Maison Martin Margiela, Viktor & Rolf and Marni, broke with conventional wisdom recently and hired as creative director for one of his houses none other than John Galliano – formerly of Christian Dior until he was fired for his drunken, ant-Semitic rant caught on video. The foppish and brilliant Galliano found himself out of a job for the past three years – my guess is less for what he said, and more for getting caught saying it.
In any event, occasionally in the world of luxury goods cultivating the “bad-boy” image is necessary to corral the next generation of high-end buyers who don’t want to dress, drink and smell like their grandparents.