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Bloomberg
The crash in the value of sterling has put Rolex and other luxury watches at discounts of as much as 19% for US visitors lucky enough to get their hands on the coveted timepieces.
Promised policy changes by the new UK government including a plan to reintroduce Value Added Tax rebates on goods bought by tourists could even boost the discounts to as much as 32%, according to watch
retail industry publication WatchPro.
With the British pound retreating to record lows against the US dollar, a steel Rolex GMT-Master II that sells for $11,289 in the US can be purchased for $9,293 in the UK with US
dollars, a discount of 18%, according to WatchPro. A 41mm diameter Datejust model can be bought in the UK for $7,088 in US dollars, a discount of 19% compared to US retail.
Rolex raised UK prices by an average of about 5% this month in hopes of heading off price arbitrage moves by buyers taking advantage of the weak pound. However, sterling’s continued decline to levels not seen in decades has made that adjustment almost irrelevant.
Still, the attractive price arbitrage is unlikely to be taken advantage of on a wide scale. With demand far outstripping supply, Rolex models are notoriously difficult to buy at retail from authorized dealers in the UK or elsewhere. Customers often put their names on lists and wait months or even years to get the call.
A Rolex Cosmograph Daytona in white gold that sells for $32,635 in the US, including 7% sales tax, could be purchased for $22,444 in the UK in US dollars when including the VAT rebate, a 31% discount, the publication reported.
Rolex is the most popular Swiss luxury watch brand, with a market share close to 29% and annual sales of about 8 billion Swiss francs ($8.2 billion). The Geneva-based company produces about 1 million watches a year.