Patek Philippe brings back the ‘holy grail’ of watches for 170 lucky buyers

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  • Patek Philippe announced on Monday that it is making 170 special editions of its most popular watch, the Nautilus Ref. 5711, as part of a partnership with Tiffany & Co.
  • The launch is likely to create a shopping frenzy among wealthy watch collectors.
  • The watch was created to honor the 170-year partnership between Swiss watchmakers and Tiffany’s, as well as to honor Tiffany’s new ownership under French luxury giant LVMH.

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Patek Philippe announced Monday that it is making 170 special editions of its most popular timepiece as part of a partnership with Tiffany & Co., which is likely to set off a buying frenzy among wealthy watch collectors.

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Less than a year after Patek discontinued the famous watch known as the Nautilus Ref. 5711, causing demand and prices to skyrocket.

Patek said he was making 170 special referees. 5711s with a Tiffany-blue face that will be sold at some Tiffany’s boutiques. Patek said the watch was created to honor a 170-year partnership between the Swiss watchmaker and Tiffany’s, as well as Tiffany’s new ownership under French luxury giant LVMH.

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For Tiffany, the chance to sell the most sought-after new watch in the world will add shine and marketing shine to a jeweler already undergoing change under LVMH and chief Bernard Arnault.

“It was my little gift to congratulate Tiffany’s on buying it,” Patek CEO Thierry Stern told CNBC. “To me, it was quite clear that I had to choose something unique and extraordinary. This is truly the last of this watch.”

Watch lovers around the world thought the last round was in January. Amid record demand for top luxury watches, Patek unexpectedly announced that it was ceasing production of the Ref. 5711, stating that the attention and demand for the watch had gone too far. The stainless-steel watch, launched in 2006, garnered fame through social media and wealthy watch lovers and has become one of the ultimate wrist trophies – a mixed blessing for a company that enjoys its wide range of creative, intricate watches and sophisticated watches. Proud of the series. Gold, Platinum and other designs.

“I still don’t know why the sudden, success [of this watch] Came so fast and went so high,” Stern said. “But what I do know is that I don’t want to be a mono-product company. So I stopped 5711. We made enough of it.”

Many watch buyers were outraged. Getting a referee. The 5711, which sold for around $30,000, already included long waiting lists and opaque terms from dealers, even for preferred Patek customers. Now, buying a new 5711 would be impossible. Price for pre-owned ref. 5711s – already under threat of speculation – raised more than $150,000 online. One sold for $475,000 at Sotheby’s auction in 2020.

Stern said his decision to build the final 5711 for Tiffany’s came from the two companies’ deep history and mutual values. In 1851, Tiffany’s became Patek’s first official retail partner in America, and on his first business trip to America, Antoine Norbert de Patek met Charles Lewis Tiffany in New York. Today, Patek watches are sold in some Tiffany boutiques and Patek watches co-stamped with “Tiffany & Co.” are sold at a large premium.

Both companies are also family-controlled, with plans to pass on the leadership to the next generations. The Swiss Stern family has owned Patek since 1932, while LVMH is controlled by Bernard Arnault, the third richest man in the world. Arnault has over the years explored the potential to combine one of the Big Four watch brands – Rolex, Patek, Audemars Piguet and Richard Mille – into a luxury-brand stable that already includes Tag Heuer, Zenith and Hublot. Stern said he has met with Arnault in the past and told him that “we are independent and have no interest in selling.”

Stern, however, wanted to give Arnault something “special” in honor of LVMH’s $15.8 billion deal to buy Tiffany. They held a virtual meeting to present the referees. LVMH from 5711, which includes the 29-year-old family scion of Alexandre Arnault, who was recently named Tiffany’s executive vice president of product and communications.

“At first, I told them, ‘Gentlemen, please stay seated because you will be quite surprised,'” Stern said. “As soon as I showed them the pictures, they were so excited.”

Along with the special Tiffany-blue coloration, the watch will have “Tiffany & Co.”. Stamp at 6 o’clock, added with Patek Philippe stamp at 12 o’clock. The sapphire-crystal case bears the commemorative inscription “170th Anniversary 1851-2021 Tiffany & Co. – Patek Philippe”. Stern also made a small “surprise” on the back that he would leave for the owners to find.

“I’ve kept something secret behind the clock,” said Stern. “It’s pretty funny.”

For Tiffany’s, Patek’s “gift” means the retailer can offer its most valuable customers the Holy Grail of new sports watches and create excitement at its boutiques. Alexandre Arnault said in a statement that Tiffany’s is “proud to present this special edition featuring a Tiffany Blue dial to our most discerning customers.”

Yet it also carries risks. Tiffany’s will have over 170 VIP customers with cash and a desire to buy the watch and most will be turned down. It will retail for about $52,000 and will only be available at Tiffany’s boutiques in New York, Beverly Hills and San Francisco that carry Patek Philippe.

“I had to warn Tiffany and I said ‘Listen, this is a great gift,'” Stern said. “But it’s also a toxic one because you’ll only have 170 pieces and the choice to sell it to the end customer is yours. There will be 170 people who will be very happy and the rest unhappy.” I hope they sell it to the right people. This is really the most important thing for me. When you do such a watch, it has to go to the right person.”

guide. The 5711 is the most extreme example of a large supply-demand imbalance in the luxury watch market. Rising stock markets, a flood of crypto money and government incentives have created record wealth, while a whole new generation of young shoppers have started learning about high-end watches and online shopping during the pandemic.

Yet Patek Philippe, Rolex, Audemars Piguet and Richard Mille – all privately owned – have not increased production significantly. According to a Morgan Stanley report, Rolex sold 810,000 watches last year, Audemars 40,000 and Richard Mille 4,300, although their numbers were lower than normal due to the pandemic shutdown.

Patek typically makes about 60,000 watches a year. Like other brands, the company says that it cannot significantly increase production without compromising on quality. As an example, Stern said it takes 10 years to train a good watchmaker who can master the complex parts and construction of a Patek watch.

“Quality will always be at the top of my wish list,” Stern said. “I don’t have to rush, I don’t have any shareholders who are pushing me. I’m not interested in increasing volume in large numbers. I’m more interested in longevity and beauty.”

However, low production by top brands has given rise to a huge online gray market for pre-owned watches. First-time shoppers at a Rolex or Audemars store usually find the watch they want is not available, and waiting lists can stretch for years for those lucky enough to make the list. So they turn to a growing ranks of online sites like Chrono24, Chronext, Hodinkee and WatchBox, which sell pre-owned watches, often at huge markups. The sought-after watches that are officially being flipped online for $25,000 or $35,000 retail for $60,000 and more.

Online prices for the pre-owned 5711 are now over $120,000. It remains to be seen what the secondary price of the Tiffany model will be when it goes on sale. An answer may come next week: Tiffany’s will auction one of the watches at Philips on December 11, with the proceeds going to the Nature Conservancy, a charity chosen by Arnault.

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