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. 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."

Head to Yahoo Finance to read the full story on the Rolex shortage.

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-leave reading for another day.