While this might be true on one level, once you get into the realm of $350+ watches it can be very hard (if not impossible) for the casual and uninformed observer to guess whether a watch cost $500 or $5,000.
$350 is already more than most people spend on any watch, and that's only the entry-level price -- I imagine some of the more premium versions of the watch are going to be $500+, though that's just speculation. That's quite expensive for a watch for the vast majority of people I think.
A five-year-long project involving some of the finest watchmakers in the world surely cost far more than $1m, and that watch will sell for much more than that at auction some day.
If it was priced to reflect its complexity it would be probably more on the order of $10m or more. Much simpler movements frequently cost $1-2 million to develop, often higher.
Pretty much the same thing that spending a few hundred will get you. Upwards of ~$500, watches are jewelry. You might as well be buying diamonds. The value is 100% in the eye of the beholder (e.g. mechanical movements that are beautiful, but no more accurate than quartz, rarer materials, name brand, etc...)
I read an interview with a watchmaker once. He used to make watches in the $2000 range, before moving on to watches much more expense (I forgot the number, $50,000?). The reason was simple: someone buying a $2000 is often there for a once-in-a-lifetime purchase - graduation, marriage, etc. Someone able to spend $50,000 on a watch typically will have no issues to start collecting them and buying many more.
Your typical $30k watch has way more than $1k of highly skilled hand labor that's gone into it. Agreed that the component prices don't add up to close to $30k, but throw in all the other overhead typical of manufacturing and selling luxury goods, including labor, advertising, servicing, maintaining physical stores, etc., and the profit margin on those watches is gonna less than, say, selling Internet ads.
I may have used the word high end erroneously here forgetting that the high end in watches is really high. I was thinking more about the $400-1000 category, comparable to an apple watch
Don't get too hung up on the $50k number, I just picked that at random because $50k in currency is a large enough stack of cash to be considerably harder to conceal and transport than a watch.
This was a few years back and he (understandably) didn't go into much detail. This is of course just a single data point, so I can't tell whether it's representative for the entire industry.
While the entry price for luxury watches is lower than it is for luxury cars, I see a fair amount of Pateks and APs that go for at least $100,000. There are many more exclusive models and companies that I know next to nothing about that are significantly more expensive, but you can get a sense of the wider market here: https://www.hodinkee.com/packages/all-the-new-watches-of-202.... And yes, I agree that the utility of a car far outweighs that of a mechanical watch. It's also why I believe that paying $150,000 for a fancy master's degree at a world-famous school is a pretty sweet deal for the wealthy and vain.
An IWC or Patek doesn't cost a few hundred dollars to produce, although I'm sure the real spread is horrific. Most luxury watches don't cost $35,000, either --- mid-4-figures is a more realistic estimate for the "BMW 3 Series" tier of watches.
"luxury watch"? I've never seen any particularly compelling sub-$1000 mechanical watches, and I'd say the "luxury" segment for watches starts at more than $2000.
That's a pretty crazy upcharge, since the base watches themselves seem readily available in very nice condition for $500-1000 - and even down to about $200 for "working, but looks a bit rough"
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