Market Update And The End Of The 'Investment Mindset' | August Update
In-depth on watch crystals, plus vintage finds from Heuer, Abercrombie, Zodiac, and Cartier.
Welcome to my regular update, and sorry for taking a couple weeks off. If you want me to keep doing these please give that heart above a tap. My Hodinkee highlights and vintage watches on my watchlist below, but first:
In this issue: Abercrombie & Fitch, Audemars Piguet, Cartier, car YouTube, Heuer, Nodus, Rolex, Tudor, Wanna Buy A Watch?, Zodiac, and more.
Gentleman dealer Eric Wind made his triumphant return to the Hodinkee podcast and we had a great discussion about the current market. Public stats have made no secret of its precarious position. According to WatchCharts, prices were down 2% last quarter, the ninth consecutive quarter of decline, and “it seems unlikely that secondary market prices will stabilize in the near future.”
Scary! But let’s zoom out from the last quarter or even the last year.
Over the past decade or so, an investment mindset has come to dominate watch collecting (and other collectibles, like art). Instead of viewing watches as a cultural object to be collected for their historical importance or craftsmanship or whatever else, too many collectors, old and new, started to view them as an asset class.
And you could forgive collectors for the misconception. The press – watch and mainstream – dutifully covered record-selling auctions, waitlists, and secondary market prices that were multiples of retail, skipping over the fact that most watches still lose value immediately after they’re driven off the lot.
To be sure, watches, at least high-end, collectible watches, remained surprisingly resilient after the 2008 financial crisis and, more importantly, after the introduction of the Apple Watch in 2015. This helped feed the investment mindset.
Only one year after Apple Watch, the stainless steel Patek 1518 sold for a record-breaking $11 million. Then in 2017, it seemingly peaked with Paul Newman’s Paul Newman Daytona selling for $17 million.
I could cherry-pick a dozen headlines, but the NY Times’ “Watches Are Yet Another Easy Way Rich People Make Their Money Into More Money” will always be a favorite for perfectly encapsulating all this.
Watches were no longer relegated to the corners of auction catalogs or flea markets; they were yet another plaything for the rich that happened to make them more money. According to the Times, at least.
Then the pandemic hit, money was easy, and all these dynamics were supercharged. Watches became more popular than ever, or so the conventional wisdom goes.
But are they really?
According to Swiss watch export data from the FHH, exports peaked in 2014 at $24.6 billion before collapsing post-Apple Watch. In 2023, that figure peaked again at $29.9 billion. But adjusted for inflation, that $24.6 billion would be worth about $31 billion in 2023.
Meanwhile, volumes have absolutely tanked. The Swiss exported 28.5 million watches in 2015; in 2023, just 16.9 million.1 To be sure, the pre-owned market has grown, some of that driven by a broader interest in pre-owned and resale luxury from younger buyers.
Put another way, the market for new watches has been basically flat over the past decade, while 40 percent fewer new watches are now sold (about 22 percent fewer if you limit it to mechanical watches).
It’s almost as if focusing on watches as an asset that might appreciate is the best way to ensure they won’t. Luckily, that investment mindset has begun to subside.
Here’s the podcast again:
Articles of the Month
I’ve been mostly enjoying the summer in Chicago, but recently spent a few days in L.A. for the Intersect Watch Show, which featured about 20 smaller brands.
Here’s my Photo Report from the day. In general, I’ve become bullish on small and so-called microbrands. I may have been more skeptical about it five years ago, but the space has continued to mature. Like other industries, I think the watch industry will experience a bit of a “barbell effect,” where big brands get bigger, the middle gets squeezed, and there’s a thriving ecosystem of smaller and independent brands (both capital and lowercase “independents”).
Crystal Clear: More Than You Ever Wanted To Know About The Watch Crystal
My latest in-depth article, and one I’ve wanted to do for a while: all about crystals, from vintage acrylic to modern sapphire.
There's a saying in sports that "a good referee is one you don't notice," and sometimes it feels like the same could be said for the watch crystal. But there's so much more to the component that we look straight through than meets the eye (or doesn't).
Over the last century, a few materials have been used to cover the dial, mostly acrylic (or plastic), mineral, or sapphire crystals. Today, sapphire is most commonly used on watches of a certain price point, though appreciation for old-school acrylic continues unabated in corners of the collecting world. It's time the crystal got its shine.
This article has more than you probably wanted to know about the history of the crystal, how it's produced, and why some collectors prefer one over the other. I even spoke with a couple of crystal innovators to get a clear vision of the future of acrylic and sapphire.
Four + One: Ken Jacobs of Wanna Buy A Watch?
While in L.A., of course I stopped by Wanna Buy A Watch? to visit Ken Jacobs, one of the trailblazing vintage watch dealers who’s been doing it for 40-plus years. He pulled out a few of his favorite watches and we chatted for an hour or so. The lemony Rolex Ref. 1530 – it uses the Oysterquartz’s angular case but has an automatic movement – he wore when I visited was the standout:
The Watchlist
Thrifting time. Auctions are a bit slower as we wind down the summer, but there’s still some action. I was hoping to swipe a Cartier London Tank or this Cartier-signed Movado in a low-key Bonhams Jewelry auction this week, but both had a ton of interest (sold for $21,760 and $4,500, respectively). Cartier, still hot. Here are a few more watches I’m paying attention to.
For clarity, when I do this, I’m featuring watches with no (or low) reserves at small auctions or on eBay. Everyone’s already covering Steve McQueen’s Monaco at Sotheby’s (I did, too!), so that’s not what this is about. Caveat emptor, as ever.
Often, I’m including watches here so that I won’t be tempted myself, and this is one of those times. Since the inimitable Max Braun (of Hairspring Podcast fame!) wrote about the vintage Sea Wolf for this very newsletter years ago, I’ve loved this little diver. Smaller (36mm) than early dive watch peers like the Submariner or Fifty Fathoms, the Sea Wolf makes up for this lack of supposed modern specs with bright colors and spunk. Zodiac introduced the Sea Wolf in the early ‘50s around the same time as those other historic divers, but it’s the forgotten man like Jayson Tatum on the Olympics squad.
Orange examples like the one seen here feel downright exotic, exactly what I want from a vintage dive watch. Often, that outer ring of orange fades away (here’s another example on eBay that shows what I mean) to make for much less interesting examples. eBay auction ends Sunday.
Elsewhere, this seller is offering a few interesting Heuers: 7721NT, Autavia GMT, a Regatta Timer (with original box), and more. Most seem to have condition issues, but the ref. 134.500 Yacht Timer Chronograph, which also comes with its original box seems to be the best of the bunch. The dots at the top are a 10-minute countdown timer, designed to count down the time until the start of a race since sailboats are constantly in motion.
Like the Sea Wolf, vintage Regatta timers are all in the colorful details.
A vintage alarm watch is perhaps the most charming of antiquated complications, something that’s lost all practicality.
Vulcain Crickets, JLC Memovoxes, vintage Tudor Advisors – all have small and loyal followers. In the mid-century, Heuer also made alarm watches for Abercrombie. They’re actually pretty hard to find – I featured a pocket watch version a couple months back, but the wristwatch is undoubtedly better.
I’ve been watching this one on eBay for about a month, and the seller has slowly brought the price down from $2,000 to $1,300. It feels like now’s the time to strike with an offer (Hodinkee Shop sold one for $1,900 a few years ago).
There’s a little bit of wear on the dial, especially noticeable above 12 o’clock, but otherwise, a solid-looking watch.
Mini Tudor Submariner Ref. 94400
Another fun and affordable midsize dive watch, this one from the ‘80s. Is it collectible? Not really – it’s just a vintage dive watch you could wear every day without really thinking about. I’ll grant that a 33mm dive watch is too small for many (most?), but if it’s your vibe. Auction ends Monday.
Rolex Jubilee Vade Mecum Book Set
Like the Abercrombie alarm, I’ve seen this book set relisted a few times now. This is a full set of the 1946 Rolex Vade Mecum Limited Edition promotional book set. Printed in English and French (this one’s English), each is a numbered edition of 1,000.
It’s a fascinating piece of Rolex history, even if David Boettcher has called it “disappointing to researchers.” The first booklet was written by Hans Wilsdorf and is the closest we have to an autobiography from the Rolex founder. The other three booklets are essentially advertising copy, perhaps to train Rolex retailers.
For the real Rolex completists, Vade Mecum.
🚗 Finally, I’m far from a car guy, but I’ve been completely engrossed in the drama of Car YouTube the past few weeks,2 perhaps best summarized by The Verge:
“In a new age of media driven by individual personality and unconstrained voice, it’s increasingly clear that traditional investment arrangements and the expectations they bring are past due for some evolution.”
Car media is an order of magnitude larger and further along than watch media, but there’s often a narrative that if you want to understand where watches (as collectibles) are heading, just look at cars.
If you've made it this far, please hit the heart ❤️ on this post to show others who are just discovering my newsletter that it’s worth a subscription.
-Tony
The decline in mechanical watches isn’t quite as drastic: 2014: 8.1 million; 2023: 6.3 million.
Tl;dr: Lots of car personalities have left established YouTube channels to start their own ventures.
thanks for the comments, i realize i forgot a "million" in the swiss watch export figures (has been updated in this version). The Swiss definitely exported more than a few thousand watches last year 😅
Yes, please keep these coming as frequently as you can! One reaction to your mention of Wanna Buy a Watch, though. On occasion the listings of vintage watches offer inaccurate details. The date of a Gallet chronograph being the most recent example.