Is China responsible for the scarcity of SS Sport models?

[In-Cog-Neeto]

Originally Posted by RoyalOac

Maybe someone much older could answer this, but does anyone ever remember the last time there was 'shortage' in Rolex history?

Originally Posted by DARK_KNIGHT

I have been on these boards for a decade and none of this is new to me.

I asked a similar questions a few months back and the old timers said they have never seen it to this extent before.

Dark Knight - are you saying the current situation has occurred before?

Of course a rising affluent population will buy more expensive things, Rolex being one of these. Speaking with various ADs, each had stated that Chinese tourists are great customers - they like PM pieces especially and each of these ADs have Chinese sales staff - this all must mean something; you wouldn’t target a specific audience if it wasn’t worth while.

Is China solely responsible for the current situation. Doubt it. I was in an AD recently where a customer bought a ‘popular’ SS model. The next day I saw that exact watch for sale privately with a 20% mark up. This ain’t uncommon unfortunately. Those who are just looking to make a quick buck are ruining the game for those who are willing to wait months for a watch they want to enjoy for the next however long. Rolex have simply become a commodity.

[bosch88]

Originally Posted by rolexinfl

When the China bubble bursts and their citizens begin to sell off their watches, the pre-owned market will be flooded and overwhelmed. Who knows what types of fakes/replacement parts/frankenwatches/etc will appear from the Asian market when this happens - it will be so huge and so fast that verifying watches for authenticity will be overwhelming and surely some things will slip through the cracks.

Are you implying that fake/frankenwatches are only a problem from the Chinese reselling their watches?

[Art 1]

Originally Posted by bosch88

Are you implying that fake/frankenwatches are only a problem from the Chinese reselling their watches?

I didn't take it that way. Just that it could be a big problem. Of course fakes come from all over. It's just that maybe more come out of China.

[yanks995]

Go to tokyo or osaka secondary markets and you will see the ones who are buying luxury watches.

[yanks995]

Trust me, the chinese know how to manage their money very well. They are among the highest in terms of savings.

[Gaijin]

Originally Posted by challer

Nearly every high end lux store in NYC/SFO and Europe has Chinese speaking sales staff to deal with these buyers. I was at Wempe NYC recently (bought three SS sports models) and the bulk of the store was Chinese buyers, paying in cash.

Same in Tokyo Greys. Chinese speaking staff, many Chinese buyers.

[Kingsking]

Sounds very possible. I know just from my own personal experience they are blowing alot of cash. I own a few condos in a foreign country and they are all currently being rented by chinese, all the high end real estate in my city is being bought up by chinese and alot of the time they dont even live in them! Our luxury goods stores all have chinese speaking sales associates to cater to the clientele which appears to be at least 70% chinese.

[tom2517]

Originally Posted by Kingsking

Sounds very possible. I know just from my own personal experience they are blowing alot of cash. I own a few condos in a foreign country and they are all currently being rented by chinese, all the high end real estate in my city is being bought up by chinese and alot of the time they dont even live in them! Our luxury goods stores all have chinese speaking sales associates to cater to the clientele which appears to be at least 70% chinese.

Go to Hermes or LV in Paris or Tokyo or what not, the stores are filled with Chinese. They drove up real estate prices in coveted places in the US or Canada are well documented. Those who still refused to believe the Chinese are responsible for global luxury boom are just in denial.

[Gaijin]

Originally Posted by rolexinfl

When the China bubble bursts and their citizens begin to sell off their watches, the pre-owned market will be flooded and overwhelmed. Who knows what types of fakes/replacement parts/frankenwatches/etc will appear from the Asian market when this happens - it will be so huge and so fast that verifying watches for authenticity will be overwhelming and surely some things will slip through the cracks.

When this debt bubble bursts and I suspect it will and soon there will be chaos in the streets of China


and the world.


I think that one of the last things people will be concerned about will be frankenwatches or fakes.

[SkyJuice]

Mao's famous words: 人多力量大 !

[superlativechrono]

I read today that 45% of Swatch group sales are now made in China.

Anyone able to report back on the AD SS stock-levels in mainland China? I might be able to arrange a business trip to Beijing....

[Sandpit]

Originally Posted by dtwer

The slowdown is not if, but simply, when.

So I'd say quit spending silly money buying from the greys, save the money, and wait for the market slowdown. It would be a buyer's market again when that happens.

The tide could perhaps already be turning. Apple sales have tumbled (you could have argued the US / China issue was partly to blame) but also Jaguar Land Rover sales in China have just plummeted too - down 47% year on year. That is a phenomenal drop. Suspect we will continue to see a trend here now.

[Quamby]

No, the mainland Chinese are not responsible for the global shortage of SS/Professional models.

Mainland Chinese like BLING, BLING, and more BLING. Steel is not really their thing, yet.

[FirstF80InSpace]

Originally Posted by Quamby

No, the mainland Chinese are not responsible for the global shortage of SS/Professional models.

Mainland Chinese like BLING, BLING, and more BLING. Steel is not really their thing, yet.

You could not be more wrong. Chinese like Rolex. Period.

[teck21]

Not sure if they are SINGULARLY responsible, but China (domestically and travellers abroad) accounts for one third of luxury goods sales today.

It would be foolish to think Rolex does not somehow fall within that sphere.

Profit driven entities increase supply to meet demand in order to maximise profit. Rolex does not happen to be such an entity, hence the scarcity of the better looking models at AD’s.

A lot of people buy Rolex not because it’s a great watch, but because it is Rolex. The first name that comes to mind of even the most horologically disinclined when it comes to luxury watches.




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[koryong]

Again, there is no shortage in SS sports models coz there's plenty of inventory at the grey dealers who sell them at a premium. The Chinese aren't drying up AD stocks - the greys are. And as some already pointed out here & in many similiar threads, the problem is Rolex's lack of action in managing this distribution or re-distribution issue.

Just my 2 cents ;-)

[teck21]

Originally Posted by Sandpit

The tide could perhaps already be turning. Apple sales have tumbled (you could have argued the US / China issue was partly to blame) but also Jaguar Land Rover sales in China have just plummeted too - down 47% year on year. That is a phenomenal drop. Suspect we will continue to see a trend here now.

Hermes, amongst other luxury product makers has just come out and declared that sales are still very strong in China, slowdown or no slowdown.

The fact is that so many people (in all of Asia Pacific ex Japan, not just China) who can afford, and wish to acquire an ‘affordable’ Rolex, relative to the number of such models being produced annually, have been created such a short space of time suggests that in the absence of meaningful supply increases, it is unlikely that things will ever go back to the ‘good old days’ when anyone could get any model they wanted from an AD.

Unless we see some very prolonged economic catastrophe in China. Like Japan since the 1990s. Even then it’s entirely possible that India might be able to pick up the slack.

Unless either of those happen, it’s never going to be business as usual again. The issue is demand relative to supply. The most basic economic demand and supply curves should give an idea of what’s happening.

I’m personally okay with never getting something I want from an AD. There are far worse things in life than being unable to spend one’s money on something one absolutely could do without. I’ll leave buying from the greys to the people who care only about getting a nice Rolex on their wrists to be seen. Like the Thai Rolex general!


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[oldman2005]

IMO many tend to blame China for many things that didn't go well with their lives but it's Rolex that is behind this, they could easily shift their production to SS Sport to meet the demand but they emphasis on higher profit margin DJ/TT/PM instead.

My 2 cents

[dtwer]

The Fed of St. Louis has a very detailed income and living standard report on China.

https://www.stlouisfed.org/on-the-ec...tandards-china

The real per capita household disposable income across China averages at 21,586.95 yuan. That is roughly $3,200 USD; the amount the entire family has to rely on for things they need and want for an entire year.

Putting it into perspective. It would take these families three years not spending a dime on anything at all just to save enough to buy a 116610ln.

I highly doubt splurging on Rolexes is high on their household budget.

[TswaneNguni]

Yes.Spoke to an AD.They come in and offer to buy the next shipment .Simple.The whole shipment .

[Rolexlover123]

So, some of you said that the Chinese were buying up luxury brands to "save face" and have the nicer things to show on their wrists. However, if you are going to buy luxury brands for that reason, why go to the SS entry level luxury. If you want to show off your wealth for those "save face" reasons, why isn't it that they buy up all the flashy Yellow Gold Sports Models with diamond bezels? It is lame to demonstrate that you can afford a luxury brand to show it off, only to let people know that you can buy the entry level model. If you want to show off your wealth, don't you want to buy a McLauren with AMG kit, vs a C-Class Mercedes? If they are "buying up the SS" market, then it is just about getting the cheapest way in on a name brand, not truly "saving face".

[Rolexlover123]

I never would buy used for this reason, I'd rather pay X% premium over losing sleep at night not knowing if I got ripped off.

Originally Posted by rolexinfl

When the China bubble bursts and their citizens begin to sell off their watches, the pre-owned market will be flooded and overwhelmed. Who knows what types of fakes/replacement parts/frankenwatches/etc will appear from the Asian market when this happens - it will be so huge and so fast that verifying watches for authenticity will be overwhelming and surely some things will slip through the cracks.

[Rolexlover123]

Per capita disposable income measures average. There may be a huge wealth gap between the really wealthy and the average joe.

China has 1.3 Billion People, even if only 0.1% of the population are wealthy enough and interested enough to buy a Rolex, that's 1.3 Million people. If each of the 1.3 million people buy just one Rolex per year, that would then far exceed the estimated 1 million units of production per year.

In my estimate, I'm assume 0.1%, not a very aggressive assumption.

Originally Posted by dtwer

The Fed of St. Louis has a very detailed income and living standard report on China.

https://www.stlouisfed.org/on-the-ec...tandards-china

The real per capita household disposable income across China averages at 21,586.95 yuan. That is roughly $3,200 USD; the amount the entire family has to rely on for things they need and want for an entire year.

Putting it into perspective. It would take these families three years not spending a dime on anything at all just to save enough to buy a 116610ln.

I highly doubt splurging on Rolexes is high on their household budget.

[broham84]

Originally Posted by Quamby

No, the mainland Chinese are not responsible for the global shortage of SS/Professional models.

Mainland Chinese like BLING, BLING, and more BLING. Steel is not really their thing, yet.

Wrong and wrong. another uneducated person spewing non-facts.

[bosch88]

What is more than "bling" are things / pieces that are hard to obtain - SS sports Rolexes / Pateks... like people all over the world... having something that is hard to get has way more "bling" than something expensive that other people with money can buy (easily obtainable - PM watches).

There are 1.4 million people in China... approx.. 400Million are middle class... just assuming 5% of them would like a Rolex.... do the math...

[Pops1973]

Went shopping for the wife in Burberry a well known British brand that does great scarfs - I bought one as a gift - most of the other people in the queue were Chinese and were buying 4/5 scarves and their famous macs. It was like they were in primark/ Walmart buying everything and anything. One thing I did notice was that they were not wearing designer clothes many just wearing everyday clothes maybe they were buying them as gifts? They all seemed very polite and down to earth people not blinging or showing off.

[Terrakot]

Originally Posted by Pops1973

Went shopping for the wife in Burberry a well known British brand that does great scarfs - I bought one as a gift - most of the other people in the queue were Chinese and were buying 4/5 scarves and their famous macs. It was like they were in primark/ Walmart buying everything and anything. One thing I did notice was that they were not wearing designer clothes many just wearing everyday clothes maybe they were buying them as gifts? They all seemed very polite and down to earth people not blinging or showing off.

I heard that most of them after tax refund sell these luxury goods to buyers from HK stores

[usnwfu]

If trademark and patents were enforced this wouldn’t happen. China just copies everybody else’s ideas and don’t pay a dime on infringement. Huawei and XM were caught clearly asking employees to steal Apple IP. Alibaba is pretty much amazon and eBay/PayPal. Renren is Facebook, weibo is Twitter ... yeah you get the point. Totally bull that they are allowed to get away with it ...

But anyways I think countries need to really jack up tariffs on these goods, ie if customs see you bring back 2-3 watches you get slapped with a 70% import duty. Only way to prevent them from buying out stores from other countries

Originally Posted by tifamo

It's funny how people on this forum are just naively swayed by the OP's theory that most Chinese buy expensive stuff on credit - that is such an over-generalization that it's almost dumb.

Having lived in Shanghai for 10 years myself, I can vouch that the city is loaded with dough. Some of the richest people I know are from there and live there, either entrepreneurs or old money. Take a step back and look at China today, we're not talking about a manufacturing empire anymore - there's now Huawei, Xiaomi, Vivo, Oppo. Heck when Apple is still busy with launching new phones with bigger but still notched screens, Vivo and Oppo are already running ahead of the game (Find X, NEX). Look into Huawei's 5G development and their phones. Look at Xiaomi's home ecosystem and it's just a knockout against Nest and Fitbit, only if US would be more open-minded and let them sell here.

So all in all, I don't know what work you do or what kind of friends you have in Shanghai OP, you need to make some better ones. Or simply, don't assume everyone who drives a nicer car than you borrowed the money. In Shanghai more than other places, I'd assume otherwise.

[zjd168]

Originally Posted by dtwer

The Fed of St. Louis has a very detailed income and living standard report on China.

https://www.stlouisfed.org/on-the-ec...tandards-china

The real per capita household disposable income across China averages at 21,586.95 yuan. That is roughly $3,200 USD; the amount the entire family has to rely on for things they need and want for an entire year.

Putting it into perspective. It would take these families three years not spending a dime on anything at all just to save enough to buy a 116610ln.

I highly doubt splurging on Rolexes is high on their household budget.

Then you better believe it. Average means nothing here, especially to a country with a population about 1.5 billion. For example, in terms of new car production and sales, china has been #1 for years. Also car price and maintenance cost are way more expensive than US, for equivalent models. Go figure.

[SeaDweller50]

Originally Posted by Sandpit

The tide could perhaps already be turning. Apple sales have tumbled (you could have argued the US / China issue was partly to blame) but also Jaguar Land Rover sales in China have just plummeted too - down 47% year on year. That is a phenomenal drop. Suspect we will continue to see a trend here now.

That’s because they’ve switched on to the fact that they are one of the most unreliable cars on the road today. Toyota and Suzuki being the most reliable.