Watch market 2023 Q4
The luxury market is subject to various
factors such as economic conditions, geopolitical events, and changing consumer
preferences. This is my personal opinion.
Best ten years 2011-2021
Diminishing Demand: Hong Kong and Asia have
been significant contributors to the global luxury market, since 2012-1015years
with a growing middle class and increasing disposable incomes driving demand
for luxury goods. Since 2019 COVID people are forced staying home and more time
more money for spending on so called “watch investment” many of them are newbies
who knows nothing about watches but they contribute a lot on the growth of
watch market, peak was Q4 2021. Rolex and other luxury watch price reached highest
which is about 2- 3.5X MSRP.
Now the market drops 45% in average of the
peak, that is about 1.5X to 2X of MSRP. To some of watch dealers and collectors,
the price is still much higher than the MSRP, but to the outsider and the
newbies they see a “big drop” on watch price, they have hope that the falls is
still carry one, that is why no one intends to buy a watch that would be lose it value in one
month or two.
The Proxy war of Ukraine triggers the down
turn of the world economy.
COVID19 had been a torture to our world economy,
China is the lead to bring up the Asian commercial market but still struggle to
regenerate free money for the general class people to buy “luxury” goods.’
Crypto money drop hell a lot from 2021 $60,000 to now $26,000 approx. that is one of the main drivers to pull the watch market
down, during the high time of the Bitcoin, Elon Musk could accept it for buying
Tesla. Some dealers could allow Rolex or RM trade using Bitcoin but that was
history. During 2019-2021 many people earned virtual currency in the Bitcoin
market converted them in to physical Rolex and RM
Tech war
USA sanctioned everything to Russia and
China, recently on set technology and forced Dutch ASML to stop shipping eUV Lithography
3-4 nm chip making machine to China. Huawei phone was No.1 in 2018 and US declared
war to Huawei and orders his northern guy to kidnapped Huawei CFO for two years.
She was released back to China on 15 Sep 2020. She lead the technology team to
make a detour and use current DUV 28nm Lithography
equipment to use multiple emersion lithography process to create 7 nm chip as
CPU on Mate60 phone!
The majority of the general people will not
buy when the market is dropping on stock market also as watch market. That is
the cause of the massive scale in price drop.
Chinese Consumers: Chinese consumers have
been a dominant force in the luxury market, both domestically and abroad. Their
purchasing power and appetite for luxury brands have had a significant impact
on the overall market growth in the region. Due to the downturns in China
consumer market so as the Watch market.
Pre-Owned and Vintage: There has been a
growing interest in pre-owned luxury goods and vintage items back in 1990-2015.
But since 2018 Rolex announced not supporting older watches beyond 2000 in
service. The vintage Rolex watches see a significant drops in demand.
Especially Rolex who vintage watch price are all controversial on the period
matching, lume condition and whether the watches is a frankenwatch or not,
these scare the newbie on vintage collection. And the market is not long as
good as before. Now in Hong Kong the vintage market is classified as “dead
market”!
US harvest the world with increase of interests
rate
No one would risk again buying the
uncertain watch in the market, they rather keep their money in bank for better
interests, HK USD interest rate is 4.5, UK Pound even p to 10.5% p.a. and Money
is King again.
Buyers’ market
The appeal of new limited editions, unique
designs, and the potential for investment in rare pieces have attracted
consumers and collectors switch from pre-owned and vintage market. It is best
time for those top 1% world rich people and watch collectors who are looking
for his beloved watch pieces now as the price is “Cheap” to them.
How about
price now
Rolex Platinum Daytona new $750,000 (was $1m
in 2021)
Rolex Daytona 116500LN White is $225,000 (was
$350,000 in 2022 Q1)
Rolex Pepsi 126710BLRO is $150,000 (was
$190,000 in 2022)
Patek Philippe 5711-1A is $720,000 (was
$> $1.m in 2022)
Patek Philippe 5711R is $900K ( was $1.5M
in 2021)
AP 15500 Blue is $35000 (was $500,000 in
2021)
AP 15202 ST is $500,000 (was $980,000 in
2021)
RM011-01 Mancini 2014 like new is $1.5M
(was 2M in 2022)
RM030 Polo white ceramic 2016 (50 pcs) is
$2M (was 3M in 2021)
(Price listed here is an average trade
price only as this fluctuates daily, FYR only)
Well, no one has a crystal ball but likely
I feel that the watch market will be gaining momentum slowly.
As my personal opinion.
1.
Buy only if you like the watch
no matter Citizen, Seiko, Rolex or AP…
2.
Use them as a timepiece rather
than keep it in vault to let it ages. The watch is not the parmesan ham or
Chinese Lap Yuk!
3.
Looking for rare piece if you
want to maintain certain value of it as this is always golden rule
The lesser the more value.
Many people asks me buying Rolex at MSRP, I think still far from
what they can expect. If they still want to buy Skydweller green, Pepsi or
Daytona with MSPR, he can wait at the AD or boutique if they are SVIP, and if they
think you had trivial purchase history there, don’t waste your time. You had
rather o buy a Mark Six as the chance to win three or four number is much higher
than you get a Daytona at Rolex Boutique with MSRP.
Till next post.
HK Snob
