The scarcity was so pronounced last fall that Rolex made a rare public statement for an article in Yahoo Finance. “The scarcity of our products is not a strategy on our part,” the statement said. “Current production cannot fully meet existing demand, at least not without reducing the quality of our watches.”
This is not to say that Rolex is not moving a product. The company made an estimated 1.05 million watches in 2021, according to a recent report by Morgan Stanley in partnership with Geneva-based company LuxeConsult, accounting for an estimated 29 percent of the Swiss luxury watch market. In comparison, Patek Philippe produces about 60,000 timepieces a year. (Rolex, a private company, does not routinely disclose sales or production figures.).
So that’s the supply part of the equation. Why the insatiable demand?
It appears that the pandemic has given the market a boost, said Steven Kaiser, the president and chief executive of Kennedy USA, a watch chain based in Australia.
“The biggest competitors in our industry were not other brands, but other luxury products such as travel, entertainment, restaurants and Broadway shows,” said Mr. kaiser. “You didn’t do those things for two years, so our industry was booming.”
Dazzling auctions also fueled the surge, Mr. Corder said. Once limited to tweedy insiders, watch auctions became a spectator sport in 2017 when Paul Newman’s Rolex Daytona — arguably the most famous wristwatch in the world — sold for $15.5 million at a Phillips auction, generating countless headlines.
The booming watch market is not limited to Rolex. Prices have skyrocketed for several models of Audemars Piguet’s Royal Oak line, favored by celebrities like Drake, Justin Bieber and Stephen Curry, said Paul Altieri, the founder of Bob’s Watches in Newport Beach, California. Exploding prices for the coveted, and recently discontinued, Model 5711 of the Patek Philippe Nautilus has drawn comparisons among some in the watchmaking world to the Dutch tulip mania of the 17th century.
