The ongoing geopolitical headaches faced by many of the world’s governments are revealing themselves in unlikely second and third-order effects at the moment, including the lack of pricing parity between regions for luxury goods. More specifically, the turmoil currently facing the English pound and the return of VAT rebates means if you’re shopping for a Rolex, it could be up to 32% cheaper to make your purchase in the UK than in the US.
It sounds impossible when you consider the incredible prices that Rolex watches have commanded over the last couple of years, with some models selling for three or four times their RRP on the pre-owned market. However, the looming threat of conflict spreading beyond Ukraine, the economic headwinds of the pandemic manifesting in inflation and (possible) recession, as well as the soaring prices of energy across Europe have meant the efforts of any brand to keep their prices approximately consistent from country to country are almost useless in the present moment.
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As noted in a report by WatchPro, despite the attempt by Rolex to achieve pricing parity by raising prices in the UK by 7% at the start of September, the collapse in the value of the pound has seen the relative price gap with the US grow to 19%. You read that right, nearly a 20% discount on your Rolex and that’s before you consider the proposed changes in VAT legislation.
In documents published recently alongside the Chancellor of the Exchequer Kwasi Kwarteng’s mini-budget, the UK government is currently planning to bring back VAT-free shopping for international tourists, meaning an additional 20% of savings can be had. If you’ve been thinking about adding a Rolex to your collection, tacking on a holiday to the UK has never been a better idea.
As an example, someone from the US looking to buy a Rolex DateJust ref. 126300 in the UK can expect a price 32% lower than in their home country, equating to a worthwhile US$2,814 (AU$4,319) in savings. If your pockets are slightly deeper and a white gold Rolex DayDate ref. 228238 has caught your eye, you can expect 31% in savings and an additional US$12,553 (AU$19,269) in your account. More than enough for first-class flights and a stay in The Savoy Hotel.
