Rolex sales rocketed to an estimated CHF 8.05 billion in 2021, according to the respected annual report on the Swiss watch industry by Morgan Stanley in collaboration with LuxeConsult, a Geneva-based firm specialising in the watchmaking industry.
Sales of CHF 8 billion at wholesale for Rolex translates to over CHF 12 billion at retail, excluding VAT.
The Morgan Stanley estimate — which Rolex will not confirm — increases the brand’s stranglehold on the global market for luxury Swiss watches, giving it a 29% share of total sales at retail.
Rolex’s previous record turnover, in 2019, was CHF 5.2 billion.
Omega has lost its place as Switzerland’s second largest watch brand to Cartier, and is part of a wider shift in market share away from Swatch Group brands.
Cartier sales grew by 40% year on year to CHF 2.4 billion, just beating Omega’s turnover of CHF 2.2 billion.
Cartier’s performance also helped Richemont watchmakers increase share as a group for the first time in several years.
Overall, the report estimates that the global market for Swiss watches in 2021 grew by 31.2% over 2020 and by 2.7% over the pre-pandemic 2019.
That rise in wholesale revenue has come almost entirely due to rising average prices as the lower end of the Swiss industry continued to lose share to Japanese, Korean and America watch and smartwatch makers.
Unit sales did rise last year by 2 million over the pandemic-ravaged 2020, but remain almost 5 million below 2019’s output.
Rolex’s results requires analysis, because its turnover has increased by almost CHF 3 billion despite only modest increases in prices and units produced (1,000,000 in 2019 rising to 1,050,000 in 2021).
Morgan Stanley and LuxeConsult suggest it has been achieved through a multiplier effect of three things.
Rolex made 5% more watches in 2021, prices rose on average by 7% and a change in the mix of models in favour of more expensive pieces added an extra 5% to the revenue total.
In addition, Rolex retained a far greater percentage of every watch sold. In 2019, turnover of CHF 5.2 billion was retained from estimated retail sales of CHF 11.9 billion.
Last year, the value of retail sales rose only slightly to CHF 12.1 billion, but Rolex trousered CHF 8.2 billion from that.
TAG Heuer is among a small number of brands that has not seen sales recover to pre-pandemic levels.
2019 sales for TAG Heuer were estimated at CHF 857, and without the pandemic, the brand was expected to join the billionaire’s club.
But the first year of the pandemic saw sales drop to CHF 589, and they recovered in 2021 to only CHF 682.
Breitling came within a whisker of overtaking TAG Heuer, which would have been a significant achievement for CEO Georges Kern, less than five years after taking the reins.
Breitling sales were estimated at CHF 680 million, more than 50% up from CHF 440 million in 2019.
Tissot, a billion franc brand in 2019, has dropped out of that illustrious club with sales of CHF 850 in 2021.
Richard Mille has been elevated to become a billionaire brand, with sales of CHF 1.13 billion in 2021, a figure it will not verify.
Audemars Piguet has cemented itself as a star performer with sales rising from CHF 1.18 billion in 2019 to CHF 1.58 billion last year.
Patek Philippe is back above pre-pandemic turnover, but with less spectacular growth than Rolex or AP. Turnover reportedly rose from CHF 1.45 billion in 2019 to CHF 1.53 billion last year.
Regarding the article on Rolex sales rise to 29% of the Swiss watch market raises an obvious question about why and how Rolex continues its lofty market share despite the following:
1. Rolex is unavailable at Authorized Dealers (AD) except to large “whale” customers of the AD which EXCLUDES most new customers.
2. The prices on the grey market are so high that we are in unchartered waters. You can say the answer is brand name recognition, astute marketing, or whatever pat answer Rolex wants us to believe. However, the pieces are unavailable to most collectors except the top 1% of the 1% wealthy buyers (the whales), and Rolex seems to be okay with excluding new customers. Just go visit an AD near you and you know this is a true statement.
On the flip side, brands like Omega & Breitling are INCLUSIVE, make excellent watches, yet barely get a mention. I hope the industry experts at WatchPro with their experience and integrity can answer the why & how Rolex is the 800 pound gorilla despite the challenges I mentioned above.