In early February, during the GJX show in Tucson, Arizona, dealer Freddy Keshmiri of Keshmiri Art & Antiques Corp. displayed a collection of Swiss watches, mostly Piaget models from the 1960s and ’70s in precious metals. Amid the scattering of gems, his showcase stood out for its abundance of gold – especially as the metal’s price soared above $5,000 an ounce.
Melting instead of collecting
According to Eugene Tutunikov, CEO of SwissWatchExpo, more and more people are selling gold watches solely because of the value of the metal. In some cases, the watch is seen as scrap rather than a collector’s item. This is gradually reducing the supply of vintage gold models in good condition.
Tutunikov gives an example: one dealer bought several vintage Audemars Piguet models (including a Bamboo), as well as Breitling watches, exclusively for remelting.
Interestingly, the demand for gold watches remains stable. According to market participants, buyers subconsciously perceive gold as a “tangible value” on the background of news about record quotations, writes RobbReport.
Especially iconic models, such as the Rolex President (Day-Date), whose appeal is enhanced by the combination of status and the high intrinsic value of the metal.
Refineries are overloaded
Adam Golden, founder of Menta Watches, notes that U.S. refineries have been overwhelmed by the volume of incoming gold and have temporarily suspended accepting new shipments. Due to high volatility, prices are only fixed when the metal is actually shipped, adding to the uncertainty.
According to him, even models such as the Rolex Sky-Dweller have sometimes been sent for meltdown (the movement has been preserved). However, less sought-after brands, such as Baume & Mercier, are more often recycled.
Golden gives the example of 34-millimeter gold Rolex models of the 1960-70s. He offered about $6,500 for such a watch, but the owner claimed that in melted-down form it was worth $8,500 – more than its market value as a watch.
Nevertheless, the most sought-after models are not significantly affected by the rise in gold. For example, the Rolex Day-Date ref. 18038 with a rare blue dial still sells for around $20,000 – well above the value of the gold it contains.
Record gold prices have led to a paradoxical situation: some vintage watches are disappearing from the market, turning into bullion. In the short term, this may create shortages and support the prices of surviving pieces.
However, for most iconic models, their collectible, historical and brand value still far exceeds the value of the metal – at least until gold equals it.
