Things get a little more complicated when we consider the fact that replica Rolex is a Swiss company. The “Swiss Made” label means many things, but one thing is often overlooked: most of Rolex’s bills are paid in Swiss currency. All those executives and watchmakers who work so hard in Geneva expect their salaries to be in Swiss francs because most of their bills are in that currency. This means that we should interpret Rolex prices through the lens of the Swiss franc, not the dollar or other currencies.
When we combine all these factors, the price increase in francs is significantly higher than in dollars, net of Swiss inflation. The new price list has a much broader impact on the watch industry. Rolex has now joined the “holy trinity” of Patek Philippe, Audemars Piguet, and Vacheron Constantin in setting five-figure prices for the very popular steel sports replica watches. In some ways, this is more of a symbolic development, but it could also lead other brands to similarly cross the five-figure red line. Moreover, without a similarly dramatic increase in Tudor prices, Rolex has effectively increased the difference between the watches in its main catalog and those of its subsidiary brands. Those who would have been hesitant to buy a Submariner at its 2021 list price may not be able to resist the relatively palatable pricing of the Black Bay 58.
This brings us to the shining point in Rolex pricing for 2022: the accelerated processing of waiting lists. For those lurking on the waiting list to “buy low and sell high,” the potential return on speculation is even lower now. But the important thing is the idea: the return on speculation is now lower. In addition, it is likely that some on the waiting list are not buying due to higher costs. These two possibilities, fewer flippers and more people not exercising their right to buy, mean that we are likely to see shorter wait times.
There are some additional benefits to higher prices. Higher prices are usually the catalyst for increased supply. Expanding your manufacturing plant or adding another shift of additional production is expensive, and the additional revenue incentivizes companies to take on those costs.
To my way of thinking, the last glimmer of hope is that with this move, the value of Rolex collectors’ watch boxes increases exactly. It may be difficult to determine what the true market value of a replica Rolex is right now because there are so many private transactions taking place and the condition of the watches in those transactions varies. However, the higher prices are now “official”. The cost of replacing a particular Rolex at retail is now indisputably higher. So folks, make sure your insurance is up to date.
Still, this year’s pricing is a bit surprising, especially coming from a company that has earned a reputation for prudent, thoughtful, and measured changes. We can only imperfectly predict what 2022 will look like for Rolex and the replica watch industry as a whole. This is not a 20/20 prognosis. However, it is rare for a struggling company or industry to raise prices significantly. From this perspective, we can interpret these developments as a good outlook for Rolex in 2022 in its segment of the watch market.