Rolex ADs don't hold onto their watches. They sell them.

[AznD85]

Admittedly I don't post here often but I do follow some threads and read online about Rolex watches.

I stopped by my local AD and we had a very interesting conversation that I wanted to share with you all hence the subject line above.

I am sharing my conversation with him and wanted to hear everyone's thoughts about this and it does make sense to me.

Nivarox is the maker of metallic alloys for hairsprings and mainsprings for the movement of the time piece. Nivarox used to make these parts for Rolex but Rolex bought the machine from Nivarox to bring it all "IN HOUSE" movement.

Rolex has been struggling to make these parts with the Nivarox machine and thus supply has been low or slow due to difficulty making these essential parts.

For Rolex to make their watches scarce starting with the famous Daytona then now some of the other ones like the Submariner is crazy. A business should find ways to ramp of their production when demand is high and if it doesn't meet the demand then their profits will be capped by production. It is not like Rolex ADs can sell their scarce sought after Rolex models for more. We all know ADs cannot do that. Therefore again, profits for Rolex and ADs are capped by Rolex production. This seems to make sense for me that Rolex has trouble producing their time pieces in terms of their movements.

What are you thoughts guys?

(I apologize if this was previously brought up before on another thread. If not, this may enlighten us all!)

[Snow-Dweller]

Rolex is worth many billions of dollars. I suspect that if they had a technical problem like you describe then they would get it sorted rather quickly.

[Castlesinthesky]

Originally Posted by Snow-Dweller

Rolex is worth many billions of dollars. I suspect that if they had a technical problem like you describe then they would get it sorted rather quickly.

^^^ This ^^^

[c.rod]

Originally Posted by snow-dweller

rolex is worth many billions of dollars. I suspect that if they had a technical problem like you describe then they would get it sorted rather quickly.

ha, this is all I could think about when I read your post....

[jsausley]

I don't buy that there are production issues limiting supply. Sorry.

[kauffee]

The blue parachrom hairspring used in most (all?) of Rolex professional watches was introduced in 2005. (https://www.rolex.com/rolex-history/2000-2013.html)
The idea that late in 2017 Rolex started having trouble producing them makes no sense.

[oldman2005]

Originally Posted by kauffee

The blue parachrom hairspring used in most (all?) of Rolex professional watches was introduced in 2005. (https://www.rolex.com/rolex-history/2000-2013.html)
The idea that late in 2017 Rolex started having trouble producing them makes no sense.

Yes, Makes no sense IMO and if that the case you would see a shortage of all Rolex watches but Rolex is cranking out oceans of DJ/TT/PM which are plentiful at your ADs. The shortage only affects SS Sport. I think Rolex scarcity marketing is at work to hype up the brand

[GradyPhilpott]

Originally Posted by kauffee

The blue parachrom hairspring used in most (all?) of Rolex professional watches was introduced in 2005. (https://www.rolex.com/rolex-history/2000-2013.html)
The idea that late in 2017 Rolex started having trouble producing them makes no sense.

[Bavariandoc]

Established businesses like Rolex would not allow itself for such problem you describe to hold up/slow down production

Scarcity of particular models is something discussed many times on this forum — its more of business strategy vs lack of production

[m j b]

Originally Posted by Bavariandoc

its more of business strategy vs lack of production

'xactly.

Daytona production has been limited for the past 20 years. And not because they couldn't make enough of those little subdial indicators.

[mulgogy]

Rolex is also a charitable trust and doesnt need to do anything to meet a temporary demand in product when the brand has never been stronger. I would say they are exactly where they want to be.

[RHJ]

Originally Posted by mulgogy

Rolex is also a charitable trust and doesnt need to do anything to meet a temporary demand in product when the brand has never been stronger. I would say they are exactly where they want to be.

Exactly! Seems that nobody wants to understand, that Rolex isn't a normal profit oriented company .... This changes everything.

[Grace]

Originally Posted by mulgogy

Rolex is also a charitable trust and doesnt need to do anything to meet a temporary demand in product when the brand has never been stronger. I would say they are exactly where they want to be.

This.
Yes, Rolex knows what they’re doing.


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[ericl]

i'm sorry - I don't see what the subject line has to do with your speculation on why there are no watches at AD's. Nowhere do you discuss them holding onto watches - you merely go into speculation that a machine making a part to the watches is not working as intended? From the way I see it, dealers are not holding the watches. Its Rolex limiting supply to their dealer channel and in turn that limited supply is spilling over to us watch aficionados. Its a multi-pronged issue:
1) They are getting limited supply from Rolex - and they're simply selling these tougher to receive pieces to their better customers who give them a lot of business over the years vs. someone currently looking for a piece, and the AD being unsure if this customer will continue their watch buying (and helping to keep the AD's lights on) in the future.
2) They're building demand from their customers so they'll be excited and happy to find a watch at MSRP so that when the economy cools, they will still clamor for the opportunity to find a piece and pay full boat for it.
I just don't find a correlation to your subject line vs. what you are trying to explain.

[marc12]

theyre focusing a lot of manpower to pump out the ever popular two tone datejusts

[MTBer]

Yeah, interesting how there are plenty of hairsprings to go around for all of the “less desirable” watches yet the shortage seems to only have affected the sports models that have historically held their value better than other product lines...

[bobabreath]

Originally Posted by MTBer

Yeah, interesting how there are plenty of hairsprings to go around for all of the “less desirable” watches yet the shortage seems to only have affected the sports models that have historically held their value better than other product lines...

Agree, there seems to be no shortage of parts for the sea of Datejusts sitting in display cases, which have the same movement as the Submariner.

[DtownRRS]

I don't know anything about watch production but I do work with multi billion dollar manufactures of other products and they can easily have issue in production just like any size company, especially if they are bringing systems in house that were made by very experienced personnel on the outside. There are very limited pools of highly skilled people out there in any industry. So I would say the point is a valid one if true but I have no idea if it's the reason for the lack of product.

[AK797]

Brexit caused a mad rush in demand not the supply collapse of hairsprings.

[Devildog]

Originally Posted by AK797

Brexit caused a mad rush in demand not the supply collapse of hairsprings.

Agreed. And not just Brexit.

My AD has has a great year. Their issue is demand. Not supply.

If more people want a product produced in set volumes that product will be harder to aquire. It’s not rocket science.

[exador]

Originally Posted by Devildog

My AD has has a great year. Their issue is demand. Not supply.

If more people want a product produced in set volumes that product will be harder to aquire. It’s not rocket science.

Finally. Some sense.

[rambo99]

Originally Posted by AK797

Brexit caused a mad rush in demand not the supply collapse of hairsprings.

i doubt it. why brexit would cause a rush in demand?

[tyler1980]

Originally Posted by rambo99

i doubt it. why brexit would cause a rush in demand?

Because watches were cheap for anyone not paying in GBP... it’s still cheaper today. My BLRO (including a 20% VAT) was less than 9k USD which is over 1,000 USD less than US retail + sales tax and the pound has recovered significantly in the past two years. It was a downright fire sale for a while.

I’m buying all my watches in the UK as it’s a discount. If i got a VAT return its a $7500 watch

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[lenfried29]

My conversation with AD was different then yours. My AD said that Rolex limited production of they watches. Rolex want to be like AP, Patek or CV when customer come and without Q pay Rolex established prices. Just repeat my AD story on this subject.
However, I have my thoughts regarding the matter but rather not speculate them on this forum. There're enough speculation on this subject.

[phraxos5]

Oh, they do hold on to watches, all the time., and they are in the safe. Especially in seasonal markets where a watch comes in in the early winter and its a ghost town until after mem day. My Sd 43 was in the safe 3 months before I bought it in the spring. Never hit the display case. Not all ADS, but definitely some. Also, they can create a phantom market which determines whether you will be flipped liver treaT one day. Excuse me, let me look at your purchase history with us. Oh, you have not brought anything from us, well, would you like to look at our other references we have in stock? Pretty simple really. Why act like its not happening?

[MTBer]

To the OP's (and their AD's credit), I have no doubts that this is the line Rolex may be telling their Official Jewelers, because tales of supposed manufacturing problems isn't as unsavory as "we're purposely manipulating the market". As an ancillary benefit, it might even be intended to plant the idea that Rolex is focused on quality control.

Just my $.02 of cynicism

[kauffee]

I think we can file this thread into the "My AD told me..." bin.

[AznD85]

Go with OMEGA lol!

[jb335]

Originally Posted by kauffee

I think we can file this thread into the "My AD told me..." bin.

x 10000

[tom2517]

Originally Posted by kauffee

I think we can file this thread into the "My AD told me..." bin.

This.