Story Highlight
– Rolex and Tudor to raise prices by January 1.
– Gold watch prices up 20% compared to 2024.
– Swiss watch market share declines, competition from Japan rises.
– High demand for gold benefits fine jewelry retailers.
– Rolex’s CPO program controls 10% of second-hand market.
Full Story
As the festive season winds down, the global watch industry is now focusing its hopes on a more stable year ahead in 2026, following a tumultuous period in 2025.
With the tariff disputes affecting Swiss watch imports into the United States hopefully resolved, there is optimism for a more predictable landscape in the year to come. This anticipated stability may simplify forecasting the industry’s direction for the next twelve months.
### Price Adjustments Expected
Recently leaked catalogues for Rolex and Tudor in the US have circulated widely online, raising speculation about upcoming price increases. The timing of this release appears deliberate, providing retailers with ample notice to prepare customers for the sharp rise in prices set to take effect on January 1.
These catalogues detail the new recommended retail prices for 2026, highlighting numerous factors influencing increases, including soaring gold prices, a weaker dollar, overall inflation, and the heightened tariff of 15% on Swiss watches imported to the US.
Rolex is set to implement an average price hike of 7% for 2026, with gold watch prices anticipated to rise by approximately 9%, overshadowing the 5% increase for steel models. This places gold watches at an average of 20% higher than prices at the end of 2024, while steel models will see a 10% increase.
When comparing these anticipated US prices with current UK prices, it appears brands will strive to maintain a level of price parity across major markets. Due to a 7% depreciation of the dollar against the pound this year, the differences in pricing are narrowing. For steel watches, the disparity is now merely 1-2% once sales tax and VAT are factored in, while for gold watches, the gap sits around 5%.
Anticipating these shifts, it seems likely Rolex and other brands will avoid excessive price increases that could skew market balance. Most expect price rises in the UK to remain within the low-to-mid percentage range, which should be manageable for a brand like Rolex that continues to enjoy a robust demand, evidenced by lengthy waiting lists.
For Tudor, price increases on most models are projected to be below 5%. This cautious approach reflects the predominance of their steel watches and an awareness of customers’ sensitive pricing thresholds.
### Operational Challenges Ahead
The landscape also presents dilemmas for brands under the LVMH, Swatch Group, and Richemont umbrellas. Companies like Omega and TAG Heuer are crafting a wide array of luxury timepieces; however, they face challenges attracting middle-class consumers willing to invest in high-end watches.
The year 2026 could prove critical for many brands, as they navigate tight profit margins while contending with rising costs. There is a pressing desire to increase prices globally by 5-10% without alienating consumers, yet inflation across the supply chain complicates this goal.
In a response to the higher tariffs, Patek Philippe, earlier in the year, increased prices but simultaneously reduced retailer margins in a way that negated losses for dealers. Such tactics may foster similar strategies among Swiss watchmakers looking to keep consumer prices manageable while maintaining profit.
### Shifts in the Global Watch Market
Switzerland’s share of the global watch market has faced ongoing decline, exacerbated by the rise of smartwatches. In stark contrast to Apple’s substantial annual sales of approximately 40-50 million units, Switzerland exported only 15.4 million watches in 2024.
While Swiss manufacturers focus on value over volume, they are now confronted by emerging independent watchmakers around the globe, including those in the UK, France, Germany, and particularly Japan. Notably, Citizen Watch Company recently reported a 6.6% increase in sales alongside an impressive 11% surge in volumes.
Meanwhile, as gold prices soar above $4,500 per ounce, demand for gold watches is paradoxically expected to rise. However, substantial price bumps like the anticipated 20% increase for gold Rolexes may push manufacturers to minimize new styles released in precious metals.
### Evolving Retail Strategies
Jewellery retailers are expected to outperform pure watch sellers, as demonstrated by the financial growth of major jewellery brands in the UK. Retailers are increasingly recognising the need to enhance their jewellery offerings alongside watches to attract a wider customer base.
Watches of Switzerland has already begun recalibrating its strategy, focusing on diversifying its range. This includes the purchase of Roberto Coin’s distribution business, emphasising a balanced approach to sales through their jewellery and watch divisions.
The importance of customer experience has never been more pronounced following the pandemic. Skilled sales teams, adept at creating personal connections with high-net-worth individuals, are essential in today’s retail environment as consumers seek more than just a transaction.
### Future Outlook
In response to changing market dynamics, many retailers are opting for fewer, larger stores focused on profitability rather than a proliferation of smaller outlets. This trend has emerged as brands ascertain the value of multibrand retailers over single-brand boutiques in maintaining sustainable sales.
Rolex’s Certified Pre-Owned programme is also reshaping the second-hand market, with notable retailers, such as The 1916 Company in the US, adapting their offerings in line with Rolex’s standards.
In summary, while 2026 promises challenges, it is also set to witness significant shifts across the luxury watch retail landscape, from pricing strategies to the integration of jewellery into traditional watch retail.
