Falling prices and rising availability of watches on the secondary market are pointing to tough times ahead in the primary market for Richemont, Swatch Group and LVMH watchmakers.
Even Audemars Piguet is seeing indicators pointing in the wrong direction.
Discounting has increased by 21% over the past year for Code 11.59s, which are now being sold at 33% below retail, and Royal Oak Offshores, which have become 11% cheaper compared to retail prices over the past 12 months, can now be bought at a 23% discount.
Only the Royal Oak still has its nose above the morass of cut-price tickers on the secondary market.
Despite an increase in discounts of 5.5% over the past year, dealers are still charging a 24% premium over retail. Punters selling a new Royal Oak to a dealer will do well to get their money back.
All comparisons are for watches that are still in production.
State of the secondary market for luxury watches
Overall, a snapshot of the secondary market in Q2 by Morgan Stanley using data from WatchCharts shows pre-owned prices bottoming out or even ticking-up for Rolex, Patek Philippe, Omega and Cartier.
Taken as a collective, watches made by Swatch Group brands dropped in price by an average of 5.8% since Q2 2024.
Discounting is deepest for Richemont and LVMH watch brands, which saw average price declines of 8.9% over the past year.
Declining secondary market prices have levelled-out since the start of the year with Q1 to Q2 price drops of -0.2% for Rolex SA, -1.1% for Swatch Group, -2.4% for Richemont and -3.1% for LVMH brands.
Tracking the price evolution of second-hand watches is interesting for equity investors as, in general, it provides a good barometer of a brand’s desirability and thus future pricing power/growth trajectory, an introduction to the Morgan Stanley report notes.
Across the entire secondary watch market, prices continued to decline in the second quarter; an uninterrupted slump that began more than three years’ ago in the spring of 2022.
WatchChart’s Overall Market price tracker shows average prices for Audemars Piguet and Patek Philippe’s most traded watches have dropped by over 70% since that 2022 peak. Rolex’s tracked watches have lost around 40% over the same three-year period.
The pace of price declines has slowed significantly over the past year and for Q2 was down just 0.3% compared to Q1.
However, WatchChart’s tracker is heavily weighted towards the most-traded watches from the big three brands, Rolex, AP and Patek Philippe, so firming prices for high volume models from these brands compensate for much weaker performances from almost all other marques.
Audemars Piguet will note that its prices declined faster than its ‘big three’ peers with a Q1 to Q2 drop of -1.3% compared to -0.2% for Rolex and +1.1% for Patek Philippe.
The report also reveals that the age of AP inventory on the secondary market is currently towards historical highs, which suggests prices have further to fall, particularly for its most-traded Royal Oak.
Patek Philippe is facing the same issue with aging secondary market inventory, an amber warning light on the normally unblemished dashboard for the brand.
Despite these concerns for AP and Patek Philippe, all evidence points to the secondary market polarizing around a handful of blue chip brands at the expense of those struggling to break into the big three, or five if you include Cartier and Omega.
This is seen most starkly in what Morgan Stanley calls Value Retention (VR), which is a measure of the premium or discount of secondary prices compared to recommended retail prices at authorized dealers.
On July 1, 2025, the report shows customers paying an average of 12.3% over retail for Rolex watches in the WatchCharts Overall Market tracker. You pay 5.6% more for Patek Philippe and — for the first time since 2022 — a discount of -1.3% for AP.
The next-best performing brand for VR is Cartier, at -28% discounts off retail prices. Omega is at -35%, IWC at -37%, Tudor should be concerned by discounting of -40% and Vacheron Constantin, which only recently had waiting lists for steel Overseas watches, must be wondering how to compete with a secondary market now offering -41% discounts.
Every tracked brand, bar Cartier, saw its VR fall over the past three months. Closing the gap between retail and market prices was made more difficult following price rises in the United States triggered by an additional 10% tariff on all imports.
This tariff also reshaped the secondary market in the United States because it all-but wiped out any profit margin on the most-traded references. Dealers rushed to import second-hand watches before the new tariff hit, which bolstered inventories that may need to be sold at deeper discounts through the remainder of this year.
Morgan Stanley’s report notes that, in the United States particularly, retail prices rose at the same time as secondary market prices fell; a toxic combination that makes it far harder for authorized dealers to compete with struggling brands from Richemont, Swatch Group and LVMH.