While demand for Rolex watches in the U.K. is constantly increasing, with customers willing to order a year in advance, the rich in China are looking to sell the luxury items they have bought.
A spokesperson for the Swiss company said that prices of Rolex watches in the U.K. increased 5% on average since the start of September 1.
According to the trade magazine WatchPro, this increase reflects the slide of the British pound against the U.S. dollar over the past several months. As the pound weakens, the prices of Rolex watches in the U.K. can become cheaper than in other markets.
Despite higher prices, Rolex has not lost its niche market at all.
According to the Business of Fashion, Rolex is considered the largest Swiss luxury watch brand. With annual sales of about $8.2 billion, Rolex has a market share of nearly 29%.
Demand for Rolex watches continues to outstrip the supply, and most customers are unable to purchase the watches directly. Instead, they must register with authorized dealers to be placed on a waiting list. The waiting time can be months or even years.
Meanwhile, the rich Chinese people are selling their Rolex for money as the mainland economy is struggling.
Unlike most other countries, the second-hand market in China is very downbeat for luxury goods. For example, the price of Rolex Submariners in China has dropped 46% this year, though this model soared 240% last year.
One of the reasons, according to SCMP, is that most of China’s urban population continues to face strict COVID lockdown measures. So the second-hand market for luxury goods has become one of the most affected. Prices of used luxury items have dropped rapidly.
Even the wealthy Chinese are beginning to cut back on their discretionary spending. A lot of people are selling Rolex watches, as well as Hermès bags, to raise cash.
This trend was completely the opposite at the beginning of the COVID pandemic. At that time, China’s affluent consumers seemed to enjoy spending on luxury items despite limited international travel.
Not only Rolex, but even luxury bag dealers in Shanghai and Hangzhou have reportedly cut the price of classics such as Hermès Birkin bags.
James Wang is a seller of second-hand luxury watches in Nanjing city. He said: “The boom time is over. We are entering a correction period that could last for a long time.”
The dealer said that this is the first time he has seen the most significant decline in his 25 years living in China.