As you may be aware, the Swiss Central Bank recently abandoned its caps on the CHF/EUR exchange rate. This led to an immediate and rather significant ~15% move in the currency, to the detriment of Swiss watchmakers and other Swiss exporters. The immediate reaction from the industry was one of shock and awe from those impacted. And of course, watch collectors everywhere wondered what all this would mean for prices (though some savvy buyers managed to snap up pieces in advance of anticipated price increases). And now we are starting to get a clearer picture of new price dynamics in the luxury watch market, with recent announcements from two of the world’s most influential watchmakers. Immediately after the exchange rate move, Rolex, the world’s largest watch brand, announced it would implement a high single-digit price increase in Japan.
And now, Patek Philippe, one of the world’s preeminent and most prestigious watch manufacturers, has announced a series of price adjustments across its various markets. As you can see in the letter below, the price changes — which include a 7% decrease here in the US — are an effort to adjust to the recent currency moves and reach price parity across markets. Beyond the U.S., prices are being lowered in other geographies as well, and raised in others. There is also mention of retail watch inventories being at “unreasonable levels” which surely factored into the announcement as well.
Click here to read the letter from Thierry Stern to his “Partners” (his retailers) outlining all the details:
And if you haven’t yet see our hands-on review and commentary on the new Patek Philippe Ref 5975 Multi-Scale Chronopgraph for the brand’s 175 Anniversary, you should check that out now, right here>>>