The watch industry has seen a fair bit of dynamism in recent years. An ownership share in Breitling has, apparently, changed hands. Richard Mille turned down an offer from Kering and, instead, Mille's children are taking an increasingly prominent role in the business. The publicly listed retailer Watches of Switzerland (WOS) is expanding geographically and diversifying their porfolio to include vintage.
One of the more significant developments, though, is definitely the acquisition of the retailer Tiffany's by the luxury group LVMH. This change in corporate ownership, alongside the departure of a prominent salesperson, created some murmurs about whether a longstanding relationship would continue. The temptation to pull Patek Philippe from display cases and replace the crown jewel of Swiss watchmaking with one of LVMH's own brands may prove simply too tempting for Tiffany's new owners. Would Tiffany's and Patek Philippe find a way to continue their relationship, one which dates to 1851?
Today, we learned the answer, and it is definitely "yes." The two companies announced a Patek Nautilus 5711 sporting Tiffany's trademark blue livery. The flags of New York City (top) and Geneva (bottom). The watch is available in a limited run of 170 examples. That production volume is not arbitrary, given that this year is the 170th anniversary of the "special relationship" between Patek and Tiffany's. The words "Tiffany & Co.," once again, adorne the watch face and, in microtype, LVMH is marked on the display caseback.
Predicting the future is not easy. But the long Nautilus wait lists ensconsced in Patek boutiques around the world probably gave Patek CEO Thierry Stern a great deal of confidence that all 170 watches would be spoken for in the blink of an eye, even at the retail price of $52,635. What is particularly interesting to me, though, is that this is the second time this year that one of the "holy trinity" Swiss watchmakers (Patek, Audemars Piguet and Vacheron) has arranged an auction to accompany a product launch. The first took place back in March, when Audemars Piguet released the Black Panther Royal Oak.
Today, we have Phillips auction house offering the new Tiffany X Patek Nautilus as the first lot in their upcoming auction in New York. One data point (the AP Black Panther launch) can be a fluke. But now we have two, and with two, you can draw a trendline. I have previously mentioned that auctions are the natural solution to the ever-hated practice of flipping (wherein someone buys an "unobtainium" watch and then immediately resells it at a profit because the secondary price exceeds the retail price). At auction, prices will naturally rise to the market-clearing level so that the number of watches available is exactly equal to the number bought at the auction-determined price. There will not be wait lists and there will not be flipping (for the most part). There are other alternatives, such as scaling up production to meet demand, but at least one brand has ruled this out.
In DMs, Hodinkee's Cole Pennington made the important point to me that auction distribution might end up excluding those who could pay the retail price but may not be able to muster the higher price realized at auction. He is absolutely right. This might make it even more difficult for new collectors to access sought-after references. There is even a solution for this, though. For example, manufacturer's coupons are often used by pharmaceutical companies to offset some of the high prices charged for medications. This is no doubt an important issue which brands must consider and resolve satisfactorily.
Perhaps due to this issue, and a few others, we have yet to see brands fully adopt auctions as a new distribution model. In all likelihood, we are quite far from that possible end state. However, luxury watch manufacturers have a reputation for caution when it comes to adjusting business practice. It has served them well throughout history. It remains to be seen if 2021's nexus of auction with watch release will morph into something more seismic for the industry. I, for one, look forward to seeing what develops in 2022.
I applaud the effort by watch manufacturers to minimize their contributions to climate change. Globally, we've made some progress towards "bending the curve" of greenhouse gas emissions, which is the good news. This figure from climateactiontracker.org shows that, even under an optimistic scenario, some increase in global temperatures is unavoidable. The bad news is that we clearly need to do a whole lot more to get to a point where we halt the growing cost of environmental degradation. As the graph I've presented here shows, existing policies are not enough to ensure a healthy planet for our children, their children, and all future generations. As Elizabeth Doer's outstanding coverage on Quill and Pad shows, the watch industry is discussing the challenges ahead and developing contributions to the fight against climate change. These include the use of recycled and recovered materials in manufacturing as well as requiring transparency in how raw materials are
Today, I learned a new term from an Instagram post by @ebaywatches. That term is "closet currency." No, this doesn't refer to someone stacking bills in some dark corner of their wardrobe. Instead, closet currency is the value that is stored in items that you put in your closet. At least, that's what I think it means. I arrived at this conclusion since eBay's post featured YouTuber Jose Zeniga describing the monetary value of different luxury watches. Zeniga also described a "luxury exchange" that eBay set up in NYC. In essence, you could take something out of your closet, go to the exchange, get an appraisal value, and then use your item and its appraisal to purchase another item that was available on the exchange. The formal definition of money is anything that is generally accepted as payment. In essense, eBay set up a NYC micro-economy in which almost any closet item could be used as money. Money is actually a pretty complex topic. It took a lo
Just before the US Thanksgiving holiday, I received a direct message on Instagram from the account @secondhand.secondhands. Al Worden's official NASA portrait from 1971. He's wearing the watch in question on his left wrist. They were looking for help identifying a watch on the wrist of an astronaut in a photo from 1971. The astronaut in question is Al Worden, pictured here. Worden was the command module pilot for Apollo 15. He orbited the moon 74 times during that mission. To this day, he travelled farther from Earth than any other person. Worden was a 1955 West Point graduate but he commissioned in the US Air Force (the Air Force Academy was not yet commissioning graduates so USMA and USNA graduates were able to commission in the Air Force). Before NASA, Worden flew the F-86D Sabre and the F-102 Delta Dagger. He then earned a Master's degree in aerospace and instrumentation engineering just before enrolling in a test pilot school in the UK. I've included a scree
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