3 months ago2 mins

Rolex Set Its Watch Forward By Upping Production

Rolex Set Its Watch Forward By Upping Production

3 months ago2 mins

Rolex Set Its Watch Forward By Upping Production

Rolex announced that it’s upping production to meet red-hot demand.

What does this mean?

We regular folk might be struggling to keep our heads above water – but we can still pity poor fund managers who can’t get their hands on fancy Rolex timepieces. See, demand’s so strong that the million or so watches the firm produces every year isn’t cutting it, and that means authorized sellers’ waitlists are getting increasingly unwieldy. But the world’s biggest maker of high-end watches is planning to turn the situation into a win-win: Rolex is creating three temporary Swiss production facilities, where it’s aiming to start churning out watches in 2025 – in addition to existing plans to build a billion-dollar production site nearby. For high-rollers, that means more fancy watches. And for Rolex, it means that annual sales – now estimated at $9 billion – might keep ticking upward.

Why should I care?

The bigger picture: Second-hand second hand.

All this unmet demand has got second-hand watches selling far above retail prices – so much so that they’re rivaling stocks as the smart money’s top asset class. Case in point: a basket of pre-owned watch models from luxury Swiss brands has grown at more than twice the rate of the S&P 500 since August 2018. One independent consulting firm even forecast that used luxury watch sales could overtake the primary retail market by 2033, with sales hitting as high as $85 billion.

Watches outperform stocks
Source: Bloomberg

For you personally: Luxury liftoff.

This hot-to-touch demand tallies well with the outlook for the whole luxury sector, which is forecast to keep cruising high after two years of strong sales. And while China’s bounceback has been slow so far, experts are hopeful it’ll bring a tidy bump in the region, where market penetration still has room to grow. In short, you may not be strapping a Daytona on your wrist anytime soon – but it could be worth adding some luxury heavyweights (think LVMH and Hermès) to your portfolios.

Luxury goods market share by geography


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