Luxury Watches

WATCHESLUXURY

What do a Rolex and gold have in common? Both items maintain and increase their value in times of war and economic and social uncertainty. This fact cannot be denied, given the expansion of the market over the past two years. Indeed, in recent months, we have witnessed a spike in the prices of luxury watches, especially those for men, to the point that some brands simply have little left to sell. If you’re interested in purchasing a Rolex, Patek Philippe, or Audemars Piguet watch, for instance, you may have to be placed on a waiting list for several years before becoming the proud owner of your chosen design. As a result, the second-hand luxury watch market has skyrocketed, and some models are now selling for 10 times the retail price. What factors have caused the vertiginous growth of this market? Let’s engage in a quick analysis of this trend and take a look at some special models. WORDS GAËLLE MOUSSET

THE EXPLOSION OF A CRAZY MARKET

THE EVOLUTION OF THE WATCH CONCEPT

Whereas in the past watches were used almost exclusively to tell the time and famed brands like Rolex or Omega were used by specific professionals such as engineers, scientists or divers, today they are often worn for style and to affirm one’s privileged social status. A luxury watch is not necessarily a sign of good taste, but it is considered to be a signal of success, especially at the professional level.

Luxury watches are among the products that best demonstrate the importance of the Veblen effect, according to which certain products sell less when their price falls and more when they are more expensive. This is the exact opposite of traditional consumer goods, which enjoy better sales figures when their prices fall, and worse ones when prices rise.

Luxury watches therefore experience an increase in sales when their prices rise. Many customers of luxury watches are interested

in these products primarily because they are expensive and often inaccessible to the average person. Simply owning and showing them off is indicative of success and a demonstration that one belongs to an elite group.

THE MADNESS OF A SHORTAGE MARKET

The Covid crisis marked the beginning of the price surge in the watch market – a bullish movement that commenced in August 2020, well before the start of galloping inflation. The unstable climate and the fear of losing everything have undoubtedly pushed some to invest in tangible assets. Luxury watches are one of them. The watchmakers’ market is facing such a surge in demand that manufacturers are having to refuse customers. Patek Philippe has no watches in stock (the waiting list exceeds 10 years for some models) and Rolex is not even taking any more orders. Moreover, the prices of some luxury watch brands are continuing to rise. If we exclude some speculative models, Rolex prices have risen 147 per cent in 10 years on average, Audemars Piguet 119 per cent, and Patek Philippe 126 per cent.

Since 2021, we have entered an inflationary phase that is pushing watch manufacturers to increase their prices. Breguet has raised its prices by three per cent, as has Patek Philippe. Inflation pushes some people to buy watches today that they will not be able to afford tomorrow. In the short term, inflation will in fact add to the organic growth of the price of luxury watches and make them even more elitist. ›

THREE MODELS THAT ARE WORTH A LOOK

The World’s Most Luxurious Smartwatch with Three Bezels: the One Buggati Smartwatch

Priced at $1,299.00, the Bugatti Smartwatch is without a doubt the cheapest item bearing the Bugatti name. It is the product of a collaboration between Bugatti and the Austrian smartwatch brand VIITA. Previous Buggati watches were made by Swiss watchmaker Jacob & Co. and cost up to $1.3 million each, and you must own a Bugatti to buy one. With the Bugatti Smartwatch, that requirement doesn’t exist.

Bugatti’s smartwatches come in three distinct styles and form the Bugatti Ceramic Edition One collection. This trio of styles corresponds to the different special editions of Bugatti cars: La Noire, Pur Sport, and Divo. The watch itself is exactly the same, the only thing that differs is the interchangeable bezel. Features include water resistance to a depth of 100m, a 10-day battery life, sapphire crystal, a ceramic case, a five-year warranty, and extreme elegance. All these factors make this watch very special.

Patek Phillipe and the Nautilus Tiffany

From designers uniting with big clothing companies to big luxury fashion brands getting together, collaborations have been taking over every industry, including the watch world. One of the most significant collaborations of 2021 saw Patek Philippe join forces with Tiffany & Co. to give us the coveted Nautilus Ref 5711, with a Tiffany blue dial. This will be the last Nautilus 5711 released by Patek Philippe, which makes it even more interesting.

In 1851, the two brands joined forces when the Swiss company wanted to conquer the American market and Tiffany became the first Patek Philippe retailer in the United States. This association was an outstanding success and this is the latest Nautilus. Limited to 170 pieces, it celebrates the 170th anniversary of this union.

It is obviously distinguished by its dial, which features the famous Tiffany blue. It also highlights the double signature with Patek Philippe at 12 o’clock, and Tiffany & Co at six o’clock. The indexes are black, as on the white dial version ref. 5711/1A-011. Written over the transparent background on the back is the message: 170th anniversary, 1851-2021, Tiffany & Co - Patek Philippe. The case is identical to the 5711/1A-010, with a diameter of 40mm and a thickness of only 8.3mm. The first model was sold to a New York bidder for $5,350,000, making it the eighth most expensive watch ever sold at auction.

Coussin de Cartier, the Watch with a Shape that Deforms When Touched, One of the Revelations of Watches & Wonders 2022.

Part of the Richemont group, Cartier presented some superb new products at the Watches & Wonders Geneva 2022 exhibition. Among them was the Coussin watch. Its case is made of intertwined gold mesh. Inside this flexible grid pattern – entirely paved with precious stones – the watchmaking engineers have integrated an innovative and secret element that allows the watch to return to its original shape as soon as you finish ‘playing’ with it. In fact, feeling the watch react to the touch becomes very quickly addictive.

The watch market has not finished surprising us and is undoubtedly in constant evolution, and the second-hand market is also developing in leaps and bounds. We can consider that watchmaking today is a specialism where marketing and speculation are dominant. While there is a speculative bubble for some models, for others, there isn’t in the least. Investing in luxury watches is therefore very interesting if you go for models that have not been affected by this speculative madness. e