Discover more from Rescapement
Rolex actually commented on its watch shortage. Here's what it said.
And 2 ridiculous Rolex Deep Sea Specials are up for auction this fall
Rescapement is an independent weekly newsletter about watches. To support independent watch journalism, subscribe now to get it delivered to your inbox every Sunday:
Why the Rolex shortage is the ‘perfect storm’
Lately, I’ve noticed more “mainstream” news publications covering what’s happening in watches, namely with the super in-demand hype watches. This time around, Yahoo! Finance got in on the action. They ran an article and video segment with perspective on the Rolex shortage from around the industry, but most interesting, Yahoo reached out to Rolex, and actually got a response.
The article starts by explaining the shortage of in-demand steel sports watches, but since you’re already on a waitlist or two, I don’t need to explain that to you.
Our favorite vintage dealer and Green Bay Packers fan, Eric Wind of Wind Vintage chimed in to explain that a confluence of factors are pushing Rolex prices up and availability down.
“I think it's really a perfect storm,” Wind said to Yahoo Finance. In addition to the supply constraints and overall demand for the product rising, he says, there are now more ways for regular owners, and dealers, to sell across the world.
“There are many more ways to sell these watches online than ever before - so anyone that could buy, for instance, a [Rolex] Daytona or Submariner can easily do it and sell it for thousands of dollars more than they paid,” Wind said.
“It's kind of like the sneaker mentality with StockX and being able to resell sneakers online much easier; the same is the case with watches. There are many more players in the market.”
Paul Altieri, the CEO of Bob’s Watches, also added some perspective.
“Supply to some extent due to COVID, where the factory was closed down for several months, that exacerbated the problem, but the supply problem had already existed before,” Altieri said to Yahoo Finance.
“Global demand has steadily increased the last five years, and supply has stayed constant, it’s a classic supply-demand situation,” he said, and this puts an “upward pressure on prices.” Altieri doesn't think Rolex is purposefully suppressing supply; it’s just that demand is so strong.
Check out official watch industry statistics and you’ll see that exports were up 8% in July compared to July 2019. What’s more, exports are up a ridiculous 48.5% to the United States over the same period.
Well, Yahoo Finance reached out to Rolex for comment, and actually got a response. Since the Crown so rarely speaks about, well, anything, here’s the Rolex statement in full:
"The scarcity of our products is not a strategy on our part. Our current production cannot meet the existing demand in an exhaustive way, at least not without reducing the quality of our watches – something we refuse to do as the quality of our products must never be compromised. This level of excellence requires time, and as we have always done, we will continue to take the necessary time to ensure that all our watches not only comply with our standards of excellence, but also meet the expectations of our customers in terms of quality, reliability and robustness. Rolex does not compromise on what it takes to produce exceptional watches.
All Rolex watches are developed and produced in-house at our four sites in Switzerland. They are assembled by hand, with extreme care, to meet the brand's unique and high-quality standards of quality, performance and aesthetics. Understandably, this naturally restricts our production capacities – which we continue to increase as much as possible and always according to our quality criteria.
Finally, it should be noted that Rolex watches are available exclusively from official retailers, who independently manage the allocation of watches to customers."
Of course, it’s mostly what you’d expect Rolex to say: (1) “no no, the shortage is not a strategy”; (2) “our production lines are at max capacity, and by the way, did you forget that we’re Rolex and we make the best watches in the world and that’s why you want them in the first place? We can’t compromise that quality”; and finally (3) a subtle reminder that the ADs are the ones actually taking orders and allocating watches. That’s not Rolex HQ.
As a much more famous blogger put it a couple of years ago, “Rolex can’t deliver sh*t.” Two years later, and not much has changed. I’m sure every single sentence of Rolex’s statement can be further analyzed and dissected, but we’ll leave such tea-leaf reading for another day.
Have thoughts on the Rolex shortage? Let me know in the comments below.
On Monday, Christie’s announced that it’ll be selling Rolex Deep Sea Special No. 1 at its November Geneva auction.
Deep Sea Special No. 1 is, well, the first Rolex Deep Sea Special Prototype made. Rolex attached it to Auguste Piccard’s bathyscape Trieste in 1953 when it dove 3,000 meters deep into the Mediterranean as a bit of a marketing stunt to prove that, why yes, we do make the very best dive watches around. It’s believed that Rolex produced seven Deep Sea Special Prototypes, and 3 have been found. Deep Sea Special No. 3 made the trip to the bottom of the Mariana Trench on Trieste in 1960, James Cameron style, and now sits at the Smithsonian. Finally, Deep Sea Special No. 5 was last seen at Christie’s in 2000.
Of course, to call it a “marketing stunt” is a bit of an unfair characterization. The Trieste was a research bathyscaphe developed to achieve the goal of reaching the deepest known point of the oceans, the bottom of the Mariana Trench. It was the deep-diving version of putting a man on the moon, just to prove we could. Rolex hopped on board to see if it could test itself as well, developing watch technology that could survive these same depths. Really, it’s fascinating they were developing this in parallel with the Submariner ref. 6204 (also released in 1953), and seeing how different the final products are.
Christie’s previously sold Deep Sea Special No. 1 in 2005 for CHF 322.4k. As Hodinkee later revealed to us in a Talking Watches, it was purchased by collector Reza Ali Rashidian and has sat proudly as the keystone of his serious Rolex dive watch collection since then. In that Talking Watches episode, Mr. Rashidian mentions it would’ve been the world-record price for a Rolex at the time, so it’s wild to think about how far Rolex and watch collecting have come since. Now, have a scroll and you’ll see your friendly neighborhood Chrono24 dealers have at least a few pages worth of Rolexes with asking prices above $300k.
Let’s be honest, it’s a well-timed coup by Christie’s. The announcement comes just a week after Phillips announced that it would also be offering a Deep Sea Special at its Geneva auction.
But the Phillips Deep Sea Special was produced after these Deep Sea Special Prototypes.
After Deep Sea Special No. 3 made it to the bottom of the Mariana Trench, Rolex produced about three dozen display models of the Deep Sea Special to celebrate and commemorate the achievement. The Deep Sea Special offered by Phillips is Number 35 of that commemorative series.
The Christie’s Deep Sea Special Prototype to the Phillips commemorative Deep Sea Special.
Christie’s also made the last public sale of one of these watches, selling Number 31 for HKD 3.3m in 2009.
So if you’re keeping track, Deep Sea Special No. 3 (the one that went to the Mariana Trench) is perhaps the most desirable of the Deep Sea Specials, but since you’d have to complete a Nicholas Cage National Treasure-level heist to boost that from the Smithsonian, the Christie’s Deep Sea Special No. 1 is the most important Deep Sea you’ll have the opportunity to get your hands on.
Christie’s hasn’t given an estimate for Deep Sea Special No. 3 yet. Meanwhile, Phillips placed an estimate of CHF 1.2m-2.4m on its commemorative series example. But really, it’s anyone’s guess how these two lots might fare. It kind of reminds me of the spring season, when two rare Cartier Pebbles popped up out of nowhere, both doing big numbers. Could both Deep Sea Specials get big results too?
Perhaps it’s worth noting that the commemorative series example from Phillips will be offered a day before the Christie’s sale of Deep Sea Special No. 1. Is it possible bidders will be sitting on their paddles, waiting for the rarer of the two at Christie’s the following day? Or, might people figure that big institutional money is going after Deep Sea Special No. 1, and bid all their ducats on the Phillips lot instead?
More to come.
👉 Subscribe now to get exclusive, independent watch journalism delivered to your inbox every Sunday:
Through the Wire
💰 Feds are suing a well-known watch dealer for insider trading. 📅 I’ve put together a watch auction calendar so you can have links to all of this fall’s sales on one page. 🐴 When Ben Clymer actually sits down to write about a watch, he’s still great at it. Here he is, explaining why the JLC Reverso Tribute to 1931 flipped his position on modern watches.
🏔 Vacheron Overseas “Everest” Limited Edition. Reports are that this Vacheron Overseas release was basically allocated upon announcement, but it’s still a killer watch. There’s a chronograph and a dual-time, both in titanium, both limited to 150 pieces. A prototype, worn by Cory Richards when climbing Mount Everest, was auctioned off at Phillips in 2019 for $106k.
❣ Finally: I tossed in an ask to “heart” Sunday’s ‘sletter. I didn’t think much of it, but apparently, it worked: that post got about 2-3x more hearts as the usual (not that I crave external validation, but…don’t we all?). Seriously, the post put up Kareem Abdul Jabbar-level engagement numbers. And he’s one of the NBA’s all-time leading scorers. Anyway, thanks for the love. More sky hooks coming to your inbox soon.