Rolex price increase November 1

[RAJEN]

Is it time for the November thread and another $25 from HM to the fund raiser?

[Haywood_Milton]

Haha! Happy to settle my dues when the account is due. Will sort it from the office during the week. Here's what I wrote on 31st August :

"At this moment I say "no Rolex UK price rise tomorrow" and will put £25 in if there IS a rise on 1st September --- as I have had reason to think was "on" and could yet happen.

If there is not one, I will also put £25 in each month from now until Christmas (or the time of a rise) if we don't get a rise on each 1st of the month (so 1st Oct, 1st Nov, 1st Dec).

In short, I think it's too late for tomorrow but the pressure on UK prices is unbearable and the rise is just a sniff away.

Good idea for a bit of fun, quite happy to fall flat on my face for the cause."

I now expect to be paying £25 to the fundraiser three times : for Oct, Nov and Dec 1st, and that early January will see the rise that is so desperately needed. A rise in November or December would rock AD's Christmases and cause a riot. Supporting Eddie's causes via the fundraiser would make frustration at Rolex's extraordinary break from pattern more bearable :-)

H

[JasonM]

What is a rise desperately needed Haywood? To get stick back into the system that's being held back?

[James.uk]

Is it correct RSC prices went up today 10%?

[Haywood_Milton]

It is NOTHING to do with the length of time since last rise. We could go for a couple more years before we exceeded the previous hiatus in price rises, as "that damned graph" shows.

It is NOTHING to do with holding stock back / releasing it. There might be a paucity of "forum darling" steel sports models, but the big sellers and money spinners in the real world are Datejusts, bicolours, gold and gem-set models. You'll generally not struggle to find them!

It IS largely to do with exchange rates and imbalances between international markets / relative prices. In short, UK Rolex are now "too cheap" in international terms, just as Euro-zone ones were a year or two ago, resulting in a well-predicted and indeed well-leaked rise for them.

I called the rise immediately after Brexit and Rolex have surprised me by holding off. They'll not tinkle on agents' vital Christmas parade but the fundamentals remain and January is now my bet. The pound won't regain its strength quickly.

I'll stick with my original prediction that when it comes it will be 10-12%.

Haywood

- - - Updated - - -

Is it correct RSC prices went up today 10%?

Yes.

[Raffe]

Rolex price increase? That is an interesting thought. My AD says blah blah blah....

I put 25 quid into the fundraiser regardless.

[RAJEN]

But if AD's are hoarding up the more popular models in anticipation of the price rise, doesn't that hurt their Christmas too?

[Haywood_Milton]

But if AD's are hoarding up the more popular models in anticipation of the price rise, doesn't that hurt their Christmas too?

No, they get so few of the best-sellers that we're not talking more than a handful in the ones I know who are doing it. They haven't suddenly received a dozen 116610s to stash away!

H

[Alansmithee]

It is NOTHING to do with holding stock back / releasing it. There might be a paucity of "forum darling" steel sports models, but the big sellers and money spinners in the real world are Datejusts, bicolours, gold and gem-set models. You'll generally not struggle to find them!

I know it's hard to pin this down totally - if we were doing a top five - what are the best sellers? Is the base model (is it still the Airking?) in there?

[Haywood_Milton]

I know it's hard to pin this down totally - if we were doing a top five - what are the best sellers? Is the base model (is it still the Airking?) in there?

179173 and 116233 (bicolour lady's and gent's Datejust) are always in there, think there's a steel Datejust or two, AirKing was always up near the top but it will be the 114300 now. Supply and price will probably keep the new, Lego colour-scheme AirKing out of the charts for a bit.

The mix looks very different from a chart compiled by forum members.

H

[Devonian]

I know that Rolex best sellers aren't what people on forums necessarily buy. On here it's more likely to be the subs, BLNR's, 116610LV's etc, whereas it's more likely Datejusts etc, however that doesn't explain the the reason for the shortage. Why are Rolex holding them back? I would say historically al,post without exception that every AD's shop I've looked into in the past 15/20 years (and there have been many) there's always been at least a sub or two among things. Now you here of people calling every AD in London and getting nowhere.

The only thing I can logically guess is that supply is similar to normal BUT due to the UK being so cheap everything is being snapped up immediately, especially from overseas buyers. Otherwise can anyone explain the logic of Rolex holding them back?

[JasonM]

Sorry, you misunderstand me, I understand why a price rise will happen, for parity with other countries, I don't get why it's desperately needed, why does it matter that they are relatively less expensive here ?

[pitbull666]

Supply is coming through two AD's I frequent have had Sub's and BLNR's come through in the past two weeks but obviously didn't make it to the window when straight out to listed buyers.

[golfg60]

Just come back from Florida and a few ads had the black and blue GMT £6700 and the deepsea
James Cameron was about £10,000 then tax of 7%

[walkerwek1958]

I would've thought it made financial sense to put prices up on Nov 1st if the pressure on UK prices is so intense. I doubt that the Christmas trade would be affected significantly, Christmas buying often defies logic and people get caught up in the spending frenzy.

Maybe I`m overthinking it!

Paul

[MarcJ]

Our prices are way out of line with Euro

I was in Bucharest last week and AD had a steel Daytona, old style, and rrp was 13200 Euro.

Over £11k for what is £8k retail here


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[Dent99]

Nobody mentioned cheaper watch prices in the UK when they were all banging on about Brexit!!!

[Dan88]

Nobody mentioned cheaper watch prices in the UK when they were all banging on about Brexit!!!

And to think, I voted in!!


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[IanBear]

Nobody mentioned cheaper watch prices in the UK when they were all banging on about Brexit!!!

Except they aren't cheaper if you are British...

[Evad3]

Haywood, any idea if Rolex are shortening the supply of watches into the UK due to being able to sell for substantially more elsewhere in the world?

[Tony]

Except they aren't cheaper if you are British...

If you earn your money in sterling all that's happened is that your money has been devalued, and everywhere else has become more expensive for you.

[kaiserphoenix]

Our prices are way out of line with Euro

I was in Bucharest last week and AD had a steel Daytona, old style, and rrp was 13200 Euro.

Over £11k for what is £8k retail here


Sent from my iPhone using Tapatalk

wow....but interesting they still have the old one at an AD!


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[Speedie]

There has been a 10% increase in service costs effective 1st October and there will be a price increase for £ very very soon.

[paskinner]

The best prediction is that by this time next year, sterling will be down to one pound equals one euro. What do you think Imported watches in the UK will cost then? People will look back on this period as a golden time.
So, buy now, while you can still afford it.

[Speedie]

The best prediction is that by this time next year, sterling will be down to one pound equals one euro. What do you think Imported watches in the UK will cost then? People will look back on this period as a golden time.
So, buy now, while you can still afford it.

Ageed. Make some investments now.

[Rev-O]

So Rolex make a little under a million watches a year. If they stop on Sundays that's still 2 watches a minute, every hour of every day.

They have all the economies of scale and amortising that come with full vertical integration.

But they put their prices up . . . why?

It just sounds like a con to me.

A big Veblen con.

Still, they are a charity you know!

[Tony]

So Rolex make a little under a million watches a year. If they stop on Sundays that's still 2 watches a minute, every hour of every day.

They have all the economies of scale and amortising that come with full vertical integration.

But they put their prices up . . . why?

It just sounds like a con to me.

A big Veblen con.

Still, they are a charity you know!

Don't like? Don't buy.

[Devonian]

So Rolex make a little under a million watches a year. If they stop on Sundays that's still 2 watches a minute, every hour of every day.

They have all the economies of scale and amortising that come with full vertical integration.

But they put their prices up . . . why?

It just sounds like a con to me.

A big Veblen con.

Still, they are a charity you know!

Yep you've got it - Rolex are running the worlds biggest Ponzi scheme! For a century and up till your post, no ones sussed it

[Blenheim]

I have looked at these threads, and come to the conclusion Rolex seem to do what they want, and having a rather good time of it

[Rev-O]

Don't like? Don't buy.

Conversely, "Like? Buy!"

I do like Rolex, I often wear a vintage one, but their business model in general and pricing policy in particular seems to consist of treating people like idiots. Not so much "treat 'em mean, keep 'em keen" as "treat them like sheep and fleece them"

Price increases for the sake driving "exclusivity" (which is normally a function of less supply or more demand but in this case simply by pricing people out of the market).

Suckers, form an orderly queue and if you're lucky you can grab a bargain by buying *just* before we push through a well-leaked price hike.

It's like a voluntary tax on stupidity.

[Tony]

Welcome to capitalism.

[Rev-O]

Welcome to capitalism.

That's my point: capitalism works on (among other things) supply and demand. This mad version of it works on gullibility and perceived value. A fool and his money . . . .

It's not like Rolex have had any obvious increase in cost of production (has the price of 904L steel gone up significantly?) and yet they whack on another x% in a time of low inflation. Why? Ironically to make their product more exclusive therefore more desirable therefore worth the increase in price: a circular argument. It's a price increase for the sake of price increase. It's not like they've even innovated lately, unlike Omega with their co-axial escapement.

Like the man said: "Don't like? Don't buy". But, again: "Idiot? Form an orderly queue, please."

Rolex lost all respect from me circa 2010 when they moved to random serial nos -- now no-one can accurately date a watch or even know how long it's been hanging round the AD's shop.

If Eddie can make good watches (Swiss movements, German cases, SEL bracelets, sapphire crystals) for £500 without all the economies of scale that Rolex have then surely a Rolex should sell for something similar. Hell, let's treble it for the sake of argument. So: £1,500. That would Nomos prices with Seiko production, surely a good margin? But no, Rolex are just plain greedy and their customers are just plain stupid.

[Haywood_Milton]

I have been especially stupid and invested a life-changing sum into trading stock and a private collection both of which almost exclusively comprise Rolex.

If I were to liquidate them all quickly before the whole, fleeting house of cards collapses, where should I better invest my watch money then? I will be hoping for excellent residual values, relative ease of service and access to parts, a brand in the four-figure price range which statistically outsells all others by a huge margin, and one which isn't overly swayed by fashion. For my collection, it should have models used or developed with mankind's leading professionals in many fields, ideally with many rare versions and developments which may be sought out in such a way that rewards reflect the research and diligence of the buyer.

Albeit couched slightly tongue in cheek, this a wothwhile question to consider. I will be interested to read any suggestions.

H

[Wallasey Runner]

Flog them all Haywood, as they said in Jaws - you are going to need a bigger boat.

[Hood]

Resistance is futile.
The only way it would change would be if the quality of the product were to take a dip and people thought they weren't buying quality anymore.
At the moment they are untouchable so can pretty much do as they please.

[Rev-O]

before the whole, fleeting house of cards collapses, where should I better invest my watch money then?

Haywood, you're the expert but in my very humble opinion I think vintage watches in general and vintage Rolexes in particular are a good bet. (This thread is about new Rolexes.) Vintage seems to be performing very well (hey, they're not making them any more, right?) I was tempted by any one of a number of 5513s a couple of years back. I mean loose, no bracelet, lower end pieces. They were maybe £3k then and are, what, maybe £5k now? I don't know. Out of my price range anyway.

(That said, the recent steep rise in some vintage military watches -- an area I know a little more about -- has led some to talk of a "bubble", plateau, correction etc.)

Conversely it seems to me that eBay is full of modern Explorers (don't ask me the reference, the I & II and such like) at what look like pretty cheap prices. (Horrible watches though. Personally, I hate any Rolex with white gold surrounds; I love the warmth of aged tritium.)

At any rate I wouldn't put all my eggs in one basket: that, for me, means not all watches and within watches not all one brand. But what do I know? I think you've been more successful than I so perhaps I should be taking your advice rather than you asking me!

Although, apropos of your line "before the whole, fleeting house of cards collapses", no doubt your saw this:

http://www.network54.com/Forum/20759...t+forecasting-

https://www.ft.com/content/20c4c216-...0-b48ed7b6126f

[RAJEN]

Re: . But what do I know

The only accurate part in a long comment:-)

[Haywood_Milton]

Rev-O,

I would agree that prices of vintage can be over-heated at times, but the long term trend has every reason to be expected to inch upwards. If there were any significant drop in prices from current levels then I would be one of many buyers picking from the market.

My post did also extend to new and recent Rolex, however. Wearing my straightforward, commercial hat for buying and selling watches every day it will be almost nothing but Rolex for my clients and almost nothing but Rolex for me. I believe that this is as far from being stupid as either they or I could be, in monetary terms.

The silly world of "high end" auctions I almost ignore these days. There is much that is not as it appears therein.

H

[paskinner]

There's no doubt that Rolex is top dog, and for good reason. They bestride the industry. They are a safe investment with a fabulous history and iconic models.
But we are not all traders, neither are we all people who value long-term cost above everything in life. There are reasons to buy other brands which have nothing to do with money and commerce. That might not 'work' for people in the trade, but it might for some people who think there is more to life than money.
Just think, we might buy something just because we like it......

[Rev-O]

Thanks H.

Re this:

I would agree that prices of vintage can be over-heated at times, but the long term trend has every reason to be expected to inch upwards. If there were any significant drop in prices from current levels then I would be one of many buyers picking from the market.

Yes, I agree that vintage is probably (still) a good long-term bet. But you're the expert. I am dabbler who buys more for my own pleasure than to make money (if my "profits" cover the costs of straps, serving and the odd duff purchase then I'm happy) and my budget is generally a three rather than four figure sum (I'm a Vicar on twenty-odd grand a year). Still, it would be interesting to compare the same amount invested in gold, vintage Rolexes and residential UK buy-to-let.

Re this:

new and recent Rolex, however. Wearing my straightforward, commercial hat for buying and selling watches every day it will be almost nothing but Rolex for my clients and almost nothing but Rolex for me. I believe that this is as far from being stupid as either they or I could be, in monetary terms.

I don't know. I'm not so sure. Rolex's Veblen pricing strategy is, imVho, myopic. (Although I'm impressed -- in a cynical way -- by two moves on their part: first, non-sequential "serial" numbers, so no-one knows when watch was made, making papers all the more important and second, the way they've manoeuvred Tudor in as a sub-brand to pick up the customers they have priced out of their main brand. Very clever on both counts.)

Finally, I do think there's a demographic issue. Men over, say, 45 years old (anyone who had vinyl and remembers the arrival of cd's) may have fond childhood memories of ticking wristwatches. They may have owned one or been entranced by their father's or grandfather's watches. Such men are now at peak earning power (for sake of argument the years from 45-60 years old). They want birth year watches and complications and rugged sports models and the Big Names. And they've got the money to buy them.

Fast forward 20 years. The digital generation. Those who grew up with "wearable tech". They already have less appreciation / understanding of mechanical marvels and are less inclined to wear jewellery. Will they want heavy, inaccurate, single-function, expensive clockwork strapped to their wrists? I hope so, but I'm not sure. Also, look at the demographics of this place and how price rises have excluded younger buyers.

I've seen the demographics of vintage motorbikes: the makes and models that blokes rode in their teens and twenties have a nostalgic resurgence 30 - 40 years later. It happened with 1950's and '60s Vespas and Lambrettas and now it's all about 1970's and 80's Jap bikes (including -- incredibly -- the Yahama FS1 moped). They get a second life when their previous owners want to re-live their youth and have the money to buy them back. Then prices fall back (although not *all* the way back) when those second-time around owners get too old to ride or maintain their bikes and move them on, by which time no wants them as the upcoming generation of buyer have no emotional attachment to those models.

Anyway, will chaps in 10, 20, 30 years' time want mechanical wristwatches? I don't know. I hope so. But I'm not optimistic.

[Raffe]

Rolex are not a charity.

They are a for-profit company, which is owned by a charity and hence their profits are funding the charity.

It isn't complicated, but apparently too complicated for many.

[JasonM]

Some astute observations there Rev, look at the explosion of prices for 80s 'classic' cars, the hot hatches of then which were aspirational to that generation are now being bought by those who can now afford them as weekend toys and have pushed prices up as a result.

[markrlondon]

Finally, I do think there's a demographic issue. Men over, say, 45 years old (anyone who had vinyl and remembers the arrival of cd's) may have fond childhood memories of ticking wristwatches. They may have owned one or been entranced by their father's or grandfather's watches. Such men are now at peak earning power (for sake of argument the years from 45-60 years old). They want birth year watches and complications and rugged sports models and the Big Names. And they've got the money to buy them.

Fast forward 20 years. The digital generation. Those who grew up with "wearable tech". They already have less appreciation / understanding of mechanical marvels and are less inclined to wear jewellery. Will they want heavy, inaccurate, single-function, expensive clockwork strapped to their wrists? I hope so, but I'm not sure.

Very good points.

I think the demographic question can go one of two ways. I am not sure which it will be.

The first possible scenario is that, as people get older, they will eventually have more disposable income and will want to display it. (Notably, it will take those who are young today longer then the current generation to gain reasonable disposable income but they will gain it eventually). When they want to display it, they will find themselves choosing largely what their parents did. Thus luxury watches will live on as a new generation comes to appreciate them. (A comparison point: Digital and quartz watches were big news when I was a child and I was only interested in digital. And yet here I am now, 30+ years later, buying luxury mechanical watches, albeit alongside quartz and digital too).

The second possible scenario is as you say: Tastes will not get 'handed down' or 'rediscovered' and luxury watches will simply die out. Or perhaps the 'luxury watches' that people want to buy will be some kind of smart watch. Or perhaps computing will have become so transparently ubiquitous[1] that any kind of on-person computing device will be outmoded and wealth will be shown in other, entirely new and novel, ways.

Personally I think it could be a bit of both. I doubt that tastes for personal luxury devices (including mechanical luxury devices) will evaporate entirely but there will be room for entirely new classes of luxury devices.





Footnote:-
1: We are already seeing the mobile boom finishing and the beginnings of the in-home AI ubiquitous computing revolution[2] (aka the IoT, as it has come to be called). This could, in time, make mobile and personally-worn devices largely redundant.

2: Post-Industrial technology booms/revolutions: Each one acted as (a) infrastructure and (b) popularity booster for the next. No doubt one can go back further in the following list but I am beginning with microprocessors as a convenience (and because their entry into the scene roughly coincided with my own life):

(1) Past: Microprocessors.

(2) Past: The home computing revolution.

(3) Past: Non-mainframe, non-terminal computers in businesses of all sizes (mainly IBM PC).

(4) Past: Internet (as communications infrastructure and subsequently worldwide lifestyle and business model changer). The significance of this cannot be underestimated and probably cannot yet be fully appreciated. Although development of what became the Internet as we know it today began before step 1 above, it came into its own as we now know it (and could only come into its own in this way) only after steps 2 and 3 became widespread reality.

(5) Past and present: Cloud computing (encouraged by advances in computing technology and the infrastructure/communication capabilities of the Internet, especially ubiquity and relative reliability).

(6) Past and present: Mobile computing (both encouraged by and symbiotic with cloud computing (step 5) and facilitated by further advances in computing technology).

(7) Present and near future: IoT and in-home AI (a natural growth from all that went before, especially 4, 5 and 6).

(8) Slightly further future: Fully ubiquitous computing. I.e. You are never, no matter where you are, detached from a network-connected computer of some sort. It knows who you are and reacts to your voice, gestures, or other subtle inputs such as mood. AI is increasingly ubiquitous. Having to explicitly think about providing input to a computer to get what you want is largely outmoded and unnecessary, except perhaps for techies and blanks. This era was actually predicted long ago but the network/cloud-centric, commercially-exploited, nature of it was not necessarily predicted. Of course, it took commercial exploitation to make it possible. (This will be within the lifetime of many on this forum).

(9) Further future: AI and robotics become totally ubiquitous. It ushers in new uncertainties about the role of humans and about economic models by offering new opportunities/risks of a nature that humans have never had to address before. This time it is entirely different to any previous introduction of new technology. See Humans Need Not Apply for a lucid explanation of why it will be different this time and why economic models will need to change. (This will be within the lifetime of quite a few on this forum).

(10) Longer term future: Who knows. A rejection of ubiquitous technology, AI and robotics, perhaps?

[Rev-O]

Thanks Mark.

I like your analysis. A slight dip in the popularity of (and therefore demand for) high-end watches would see a potential glut of over-supply and a dip in prices. I could see this becoming a big fall if people offload while hey can still get a good price. And because of demographics I can't honestly see popularity / demand increasing or even maintaining its current level.

Related to the demographic issue is the cycles or waves that collectibles and antiques go through. It's not my area but I understand Japanese wares are down and Chinese are up (two very different economies). There was a time when Art Deco was very out of fashion and you couldn't give it away. Now it seems that "Midcentury" Nordic and Scandi are popular (my mum is amazed that Ercol furniture from the 1960s is hip).

Vintage watches have done well lately, especially certain makes / models (e.g. Rolex ss sports) and types (military). Other haven't done so well (hummers, tuning-fork and other early electronic stuff). Again, not really my area -- just pointing out that the market has fads and phases. Also by common consensus some styles have aged well while others look dated. If we could predict what would be a future classic then we'd all be millionaires. Also, what is now, currently, considered classic is a shifting, fluid, dynamic thing: see the stuff about bikes and cars or the changing tastes or the difference between the Russian and Chinese oligarchs buying back their art vs the limper Japanese market.

If I had a lot of money (I mean, five and six figure sums -- maybe Hayward's sort of money, I don't know) would I put it all in watches? No. Even vintage Rolexes? No. But would I have some as part of a mixed portfolio? Yes. Also, I love wearing vintage watches and even if I were to sell them at a loss I'd have had the joy of ownership and education and experience and I'm happy to pay for that (within reasonable limits). It's not all about investment and money, money, money.

Do I think that practical, historical, and/or rare models will hold their value or even increase? Yes. (I know they have, lately, I'm up on my deals this year ;-) ) They are also, as I said, a pleasure to own and wear and learn about. That, to me, is worth something intangible and unquantifiable.

Would I buy a new Rolex at current prices (never mind after any increase)? No. I think they are overpriced / overvalued. Even with Rolex's legendary residuals I honestly think market forces will be against you in the long term. Also, I don't like them. Any of them. (I spent all weekend wearing a 1950s Oyster Perpetual though.)

But Rajen, what do I know? Not much.

[sean]

If I were to liquidate them all quickly before the whole, fleeting house of cards collapses, where should I better invest my watch money then? I will be hoping for excellent residual values, relative ease of service and access to parts, a brand in the four-figure price range which statistically outsells all others by a huge margin, and one which isn't overly swayed by fashion. For my collection, it should have models used or developed with mankind's leading professionals in many fields, ideally with many rare versions and developments which may be sought out in such a way that rewards reflect the research and diligence of the buyer.

Fossil?

[Haywood_Milton]

Fossil?

There is a case for Krug Baumen.

[JasonM]

There is a case for Krug Baumen.

Has it gone green?

[Lovewatches108]

Fossil?

Haha!

[Rev-O]

A couple more thoughts that came to me in the night.

First, as well as the demographics of wristwatch ownership (and look at how many absolutely beautiful pocket watches there are on eBay at crazy cheap prices) there's the inter-generation wealth issue. My parents (Baby Boomers born just after WW2) are the blessed generation. I'm doing ok (aged 45 I own my own house). But Gen X and the Millennials? Property is the big issue, but also wages / employment and wider implications of globalisation. Give a 20 or 30 year old £10k and it's towards a deposit not spent on a holiday or watch or whatever.

Second, it seems to me that Rolex are now basically producing something between a currency and an investment (like stock or a bond). It's almost as if people are buying shares in Rolex or a unit of currency when they buy one of their watches. That's OK but we all know what can (and does) happen to such investments. By raising prices for the sake of raising prices (ie without any external -- much less objective -- market forces at work) Rolex are playing a dangerous game. Pyramids and Ponzi Schemes have been mentioned and I think that is wrong, but I can see the aforementioned demographic forces at work in 10, 20, 30 years' time.

Third, and related to point 2, look at the business practises of Rolex. Right now, at the same time as this thread, there's at least two threads on Watch Talk about Rolex and/or ADs distorting the market with supply-side shenanigans.

E.g. here: http://forum.tz-uk.com/showthread.ph...tricted-Supply

That's not a company I want to be involved with and such sharp practice always comes back and bites you on the bum. (Yes, a Vicar said "bum"!)

Anyway, like the man said "Don't like? Don't buy." But I wanted to explain what i don't like and why I won't be buying.

You may disagree but I hope it at least makes sense.

[NickRed71]

Some astute observations there Rev, look at the explosion of prices for 80s 'classic' cars, the hot hatches of then which were aspirational to that generation are now being bought by those who can now afford them as weekend toys and have pushed prices up as a result.

Too true. You've just prompted me to look for a Renault Fuego. I wouldn't be surprised if mechanically it was a disaster, but to my 8-year-old self it looked super cool.