How long will the Rolex Bubble Last

How long will the Rolex Bubble Last

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Discussion

jonah35

3,940 posts

156 months

Wednesday 2nd January 2019
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I’m on holiday in a typical Caribbean resort

Every bloke has a Rolex on their wrist - it’s kind of comical.

But they will keep going up until there’s a recession then they will start going under list for most

Gotta hand it to Rolex it’s utterly amazing marketing

If an AD rang any of us offering a ss Daytona for list we would all buy it there and then, no quibbling, no haggling and we would be chuffed.

If Breitling called to offer us a watch at a discount we would all be nervous of residuals, trying to haggle further and be a bit nervous of the purchase

I cannot get my head around people not wanting to pay a premium either. Paying £16k for a new Daytona is a far safer home for your money than getting a hublot Big Bang at a 10% discount


jazzybees

816 posts

121 months

Wednesday 2nd January 2019
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hi evokid.
I was offered 15% off the breiting superocean heritage 2, if I did not use their interest free credit.
as you say beautiful watch.

Buster73

5,042 posts

152 months

Wednesday 2nd January 2019
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Taaaaang said:
The problem with popping into the AD to see what you like is that they don't have any stock to look at!

A few weeks ago I went watch shopping with a colleague and there wasn't a single sports rolex available to see in the whole of Birmingham. Not even precious metals.

Just DJ variations by the million (which was what he wanted luckily, but still).
A few weeks ago = just before Christmas.

I’d be amazed if any dealer had a full selection of any brand to look at never mind a Rolex dealer given the national shortage of SS Rolex models combined with the time of year.

amare32

2,417 posts

222 months

Wednesday 2nd January 2019
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Not sure if the bubble will burst anytime soon...

I was in Hong Kong last month and a pre owned SS Ceramic Daytona could be had for £15k, then in the space of 3 weeks it had jumped up to £17k. It's nuts but if people are prepared to pay for it more power to them. In the UK, Watchfinder has a white faced SS Ceramic Daytona for £20k!

Having put my name on the list on a Daytona at my local AD, will just wait and see if I get the call for one. The same AD in question did call me to offer a Hulk in Aug 2017 literally 3 weeks after putting my name do for one so it's possible to acquire SS Rolex for list price.

andy tims

5,571 posts

245 months

Wednesday 2nd January 2019
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AmosMoses said:
andy tims said:
This.

What I fail to get my head around is why Rolex make lots of watches that seem to sell slowly & not enough of the ones that fly off the shelf (if they even hit the shelf)?
Just make a few more Subs, GMT's & Steel Daytona's & few less Datejusts etc.

confused
They will never make enough to supply the demand, it's what they do! How do you sell a lot of something? Tell people they cant have it.

Rolex are a genius brand that really gets peoples backs up, they treat customers like st, why? Because they can and its how they make millions every year.
My point is without increasing overall production they could make say 20% more SS Sports models, still not satisfy demand, but make even more profit.

jonah35

3,940 posts

156 months

Wednesday 2nd January 2019
quotequote all
andy tims said:
AmosMoses said:
andy tims said:
This.

What I fail to get my head around is why Rolex make lots of watches that seem to sell slowly & not enough of the ones that fly off the shelf (if they even hit the shelf)?
Just make a few more Subs, GMT's & Steel Daytona's & few less Datejusts etc.

confused
They will never make enough to supply the demand, it's what they do! How do you sell a lot of something? Tell people they cant have it.

Rolex are a genius brand that really gets peoples backs up, they treat customers like st, why? Because they can and its how they make millions every year.
My point is without increasing overall production they could make say 20% more SS Sports models, still not satisfy demand, but make even more profit.
If you increase the supply you reduce the waiting list which in turn reduces their worth in the second hand market which in turn reduces demand

Let’s face it, if Daytona’s halved in value on day one a lot less people would buy them. Everyone says they just like them but if they’re honest half is with a view to flipping,
Making money or just not losing a bomb

Rolex know what they’re doing.

andyman_2006

718 posts

189 months

Thursday 3rd January 2019
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Pretty sure the bubble wont burst, i heard there are a good number less AD's now than say 5 years ago, and Rolex are not going to supply any more stock any faster than currently, demand is high for a lot of the SS models, its a simple supply and demand situation, not helped by flippers and grey dealers though.

Reading about the Daytona and what people are paying makes me pleased i dont actually like them, would much rather have a Green Sub, or a D-blue Deepsea.

Having been lucky to purchase a GMT2 Blue/Black Batman last Nov, i'm well chuffed, wont say exactly how long it took to get but not very long and have a good relationship with my AD, i may at some point this year express my interest in a Green Hulk Sub and see what happens, if it take a year so be it.

There are other nice Rolex watches that i like though, and would happily own a new Air King, or a Milgauss.

The Milgauss and Air King were both in stock when i went to an event at my AD, i find it odd that some grey dealers are trying to sell these over list on ebay, when they can be had at RRP easily, maybe the SS sports price madness is being dragged onto other models, but i see no reason to pay more than list for anything, my local AD was more bothered about the fact i was local resident, and to be fair kept my papers for 6 months, which whilst not ideal matters very little if your keeping it and not flipping it for profits.

Andy

RDMcG

19,095 posts

206 months

Thursday 3rd January 2019
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I think we are in for a major economic downturn and the Rolex bubble will burst, just as the bubble for GT Porsches and the like will also burst.
These are things that are purely optional. We are seeing real estate also showing a global easing.
Not going to be pleasant.

Lorne

543 posts

101 months

Thursday 3rd January 2019
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RDMcG said:
I think we are in for a major economic downturn and the Rolex bubble will burst, just as the bubble for GT Porsches and the like will also burst.
These are things that are purely optional. We are seeing real estate also showing a global easing.
Not going to be pleasant.
The real estate bubble has popped in London with values down 20% since the UK decided it wanted to exit the EU.

Apple, which always appeared to slightly restrict supply in order to justify rather high prices, saw share prices drop 7% overnight after a profits warning with Radio 4 this morning saying you can now buy their products at discounts.

If Rolex make a million watches a year, each watch lasts a good 50 years (which they do as they're lovely and well made) and the style doesn't really change from one year to the next, then there's an awful lot of them kicking around and more supply being added each year.

On a balance of risk vs potential profit I'd personally suggest a £10k Lotus Esprit might be a better investment.

ZesPak

24,421 posts

195 months

Thursday 3rd January 2019
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Lorne said:
On a balance of risk vs potential profit I'd personally suggest a £10k Lotus Esprit might be a better investment.
I'd agree on most parts, though one of the things Rolex has managed to do is keep their value despite you using it (even daily).
So while a well kept "analog" sports car will probably be solid to put your money towards, you need to forego the daily use.

Lorne

543 posts

101 months

Thursday 3rd January 2019
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ZesPak said:
Lorne said:
On a balance of risk vs potential profit I'd personally suggest a £10k Lotus Esprit might be a better investment.
I'd agree on most parts, though one of the things Rolex has managed to do is keep their value despite you using it (even daily).
So while a well kept "analog" sports car will probably be solid to put your money towards, you need to forego the daily use.
That's where I've always gone wrong with sports cars!

UnclePat

508 posts

86 months

Thursday 3rd January 2019
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andy tims said:
My point is without increasing overall production they could make say 20% more SS Sports models, still not satisfy demand, but make even more profit.
You are quite correct, but it's just that they simply don't want to, and they make such great mark-ups on precious metal, too.

Really, when it works so well for them as a business, who can frankly blame them?

Despite being a registered charitable foundation, I don't think anyone should be under any illusions that Rolex are about anything other than one core aim: to make the most money as possible long-term, from producing the best watches they can make.

The funny thing is, one man's feast is another's famine - for every potential customer dismayed by Rolex, there's an existing owner only to happy to see the value & prestige of their watch maintained. And many more queuing up to buy.

As to a bursting bubble, Rolex have weathered a few of those already, so I don't foresee any fire sales, but undoubtedly the super-heated vintage prices may deflate a bit, and there will be a knock-on slowdown to general sales, but not to the point many are predicting.

UnclePat

508 posts

86 months

Thursday 3rd January 2019
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For another take on the luxury watch business, and another example of a company which knows exactly what it's doing as regards ever-increasing prices (they bumped their SS Nautilus by a whopping 20% last year) & manufactured steel sports shortage, this is a 'great' interview with the man in charge of Patek Philippe: https://www.hodinkee.com/articles/a-conversation-w...

And by 'great', I mean the man talks a load of nonsense about what it would take for them to switch some production away from the lucrative, aspirational but less popular precious metal, to stainless steel instead:

"There are limits, and you have to understand and they have to understand that, today for example, I'm working for 2029. I have to plan it for a lot of things, in terms of movements; in terms of cases we need about two to three years in advance. And all of that takes time, and there's no way I can increase that. The people who I have today are the best, and to be able to train another watchmaker, for example, for the finest watch, it's gonna take me 15 years. So, even if we decided today to increase production, I'm going to need 10 to 15 years before I can have those watchmakers."

But to his credit he freely admits they are doing it to protect existing customers, rather than pandering to market demand.

They're all the same. Well, the successful ones, anyway.

Nano2nd

3,426 posts

255 months

Thursday 3rd January 2019
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UnclePat said:
.

They're all the same. Well, the successful ones, anyway.
and that's exactly why they are successful

EvoSid

Original Poster:

1,100 posts

62 months

Friday 4th January 2019
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Lorne said:
....
On a balance of risk vs potential profit I'd personally suggest a £10k Lotus Esprit might be a better investment.
I already a have a nice Mistsubishi Evo VI tucked away in the garage . I bought it new 20 years ago and only done 30,000 miles in it. But I use it in summer and garage it in winter.

EvoSid

Original Poster:

1,100 posts

62 months

Friday 4th January 2019
quotequote all
amare32 said:
Not sure if the bubble will burst anytime soon...

I was in Hong Kong last month and a pre owned SS Ceramic Daytona could be had for £15k, then in the space of 3 weeks it had jumped up to £17k. It's nuts but if people are prepared to pay for it more power to them. In the UK, Watchfinder has a white faced SS Ceramic Daytona for £20k!

Having put my name on the list on a Daytona at my local AD, will just wait and see if I get the call for one. The same AD in question did call me to offer a Hulk in Aug 2017 literally 3 weeks after putting my name do for one so it's possible to acquire SS Rolex for list price.
So true and so me
After having looked at the Daytona I am not a fan as it is to small and has no date . I think I prefer some of the Tudors.
But I do like the Hulk (but only because it is a green Rolex) and the Sea Deweler with the Blue / Black dial.

Might buy something cheaper and put my name down on a Rolex , might get lucky and get one

EvoSid

Original Poster:

1,100 posts

62 months

Saturday 5th January 2019
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mikeveal said:
...
Should you get one? Yes, if you have the cash and you like one. There are many far more imaginative choices out there for your pennies, but none as recognisable to Joe public.
As a watch novice what other watches are worth a look. Not worried what Joe Public think as long as watch is quality and can be handed to my children in the future or sold if need be and still be worth something

ZesPak

24,421 posts

195 months

Saturday 5th January 2019
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EvoSid said:
As a watch novice what other watches are worth a look.
There really is no end to answers on that.
What's your budget and what style do you like?

anonymous-user

53 months

Saturday 5th January 2019
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RDMcG said:
I think we are in for a major economic downturn and the Rolex bubble will burst, just as the bubble for GT Porsches and the like will also burst.
These are things that are purely optional. We are seeing real estate also showing a global easing.
Not going to be pleasant.
It’s definitely happened before, in the 80s all the yuppies wanted submariners, nobody wanted GMT’s or even Daytona’s. After the 80s submariners were symbolic of greed is good naffness. GMTs could be found under list well into the 90s. I remember being offered discounts on a new gmt in the late 1999 in London in Selfridges (I think)

It’s only comparatively recently that Rolex SS sports watches, especially GMT’s, have become so popular again. Used going over list is very recent.

I remember on here the first Daytonas selling above list and then the green submariner. After that it’s gone mad.


Cheib

23,110 posts

174 months

Saturday 5th January 2019
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Koln-RS said:
The waiting lists / premium prices, for certain Rolex models - particularly the S/S Daytonas, is not an entirely recent phenomenon.
It goes back decades, although back in the 1990s it was more like 12-18 months and a £1k premium.
But, in those days, far fewer people would consider paying large sums for a watch.
We now live in different times, where there is more money around, and a recognisable prestige watch is an important status symbol.
.
Just happened across this thread....not really up on the watch market! Have a couple of nice watches including a S/S Daytona but I’ve owned mine for 20 years, I bought it in ‘98 for £4000....list was £3700. They were unobtanium even then...although it was the White Face that was really in demand...mine’s Black.

So what’s a 20 yr old Dayton worth out of interest ? Not selling hopefully be my son’s one day.

With regards to the OP’s point the biggest risk apart from say Chinese demand is the GBP/CHF exchange rate IMHO. Before the GFC that used to hover around the 2.30 level and is now at 1.25....don’t think it’s going back there but you could perhaps see decent retrcement over 5 plus years. I remember buying a S/S Submariner for a bloke I worked with from a jeweller in Switzerland when I was on a ski trip....think it’s was 20 to 30% cheaper than buying in the UK.