IN-DEPTH: What affect has soaring price of gold had on watches?

The meteoric rise in the price of gold has escaped no-one’s attention in the past year and more. But what effect has this relentless price climb had at the coal face for watch manufacturers, especially those who are disproportionately reliant on gold in their manufacturing process? Watch and jewellery journalist and consultant Rachael Taylor investigates when, if ever, the end consumer will really feel the price at the pump.

The price of gold has been a huge topic among jewellers — and investors — in recent months. While there has been a reprieve since the peak of $5,634 per ounce on January 28, the price of gold has roughly doubled in the past year and, at the time of going to press, was still around $4,500. 

The impact of such rises on a pair of solid gold earrings or a wedding band are easily calculable, but the shockwaves are less visible in the watch world. While jewellers are hastily doubling prices, watchmakers including Rolex, Cartier, and Audemars Piguet have announced more modest price increases of between 5% and 8% on gold models.

That’s not to say that bigger leaps won’t come. “It is essential to understand the latency embedded in our industry,” says Guido Terreni, CEO of Parmigiani Fleurier. The Swiss brand has a healthy selection of gold models within its range and will launch a Tonda PF Micro Rotor with agave-blue dial in 18-carat rose gold this year. “The gold purchased today will not be on a client’s wrist tomorrow,” he continues. “Between sourcing, manufacturing, finishing and distribution, the cycle can extend eight to 12 months, sometimes longer for complex pieces. What the market is experiencing now only partially reflects current spot prices. The real structural impact will appear progressively in future launches.”

Of course, even when price increases come, they are not likely to be linked directly to the price paid per ounce of gold. After all, as Edouard Meylan, CEO of H. Moser & Cie., points out, the perceived value of a luxury watch should not hinge on the materials. “We don’t operate on short-term reflexes,” says Meylan. “Watchmaking is a long game. When adjustments are necessary, they are measured and integrated into a broader pricing strategy rather than applied as direct, reactive surcharges. The price of a Moser watch reflects far more than the weight of its case; it reflects craftsmanship, innovation, vertical integration, and long-term value creation.”

Where the market might feel the pinch is in solid gold models with quartz or very simple mechanical movements. “In a full gold bracelet watch housing a simple time-only movement, the raw material can represent 70% to 75% of production cost,” estimates Terreni. “Such configurations are naturally more exposed to fluctuations.”

In general, the rising price of gold hasn’t dimmed the desire for precious metal models. Terreni keeps a keen eye on the Swiss watch export figures and reports that approximately 45% of exported Swiss watches valued above CHF10,000 have gold cases. “That statistic alone suggests structural stability rather than retreat,” he says. “Gold remains deeply embedded in the codes of high watchmaking. It carries weight — materially and symbolically.”

Indeed, the well-publicised rising of gold’s stock is actually a turn-on for some buyers. “Gold has always been emotional,” says Meylan, whose gold launches this year include H. Moser & Cie.’s Endeavour Tourbillon Skeleton in a coppery alloy of 18-carat rose gold called 5N.  “When prices rise, it reinforces gold’s status as a store of value, which can make it more desirable for certain collectors.”

For others, the ‘loud luxury’ now expressed by a gold watch — particularly yellow or rose gold — can be off-putting. “For those who favour discretion over visibility, the attraction may not increase proportionally,” notes Terreni. 

While it is highly unlikely someone might consider scrapping a luxury watch for the gold — despite the slew of content creators, such as New York Diamond District’s Trax NYC, making videos with Rolexes being placed on scales to determine the potential scrappage fee — some timepieces are at risk. “Certain brands, where the value of the gold has now outstripped the value of the watch, [are being scrapped],” says Christophe Hearn, vintage watch specialist at WeBuyVintage, a platform dedicated to buying all manner of vintage goods from the public for resale, including jewellery and watches. “Lower-end luxury brands that may not have had the same grey-market value as brands like Rolex and Cartier are probably hit the most by this — for example, Longines and Rotary. Vintage watches over 20 years old where the value of the metal has overtaken the value of the items are most certainly being scrapped for gold, sadly.”  

While Swiss export figures for gold watches are strong right now, as brands sell through timepieces that benefitted from gold bought at lower prices, the question is whether brands will start to reduce production runs in the future, or even look at alternative materials for precious models. 

“The industry is already evolving,” says Meylan. “Rising gold prices accelerate a conversation that was happening anyway — diversification of materials. At H. Moser & Cie., we are consciously exploring alternatives, not as substitutes, but as creative opportunities. Ceramic, for example, offers durability, technical performance and a very contemporary aesthetic language. Steel, titanium and innovative alloys also allow for bold design directions. We don’t see it as reducing gold; we see it as expanding possibilities.”

For watchmakers that still want a precious metal, platinum (at about half the price per ounce of gold) is an option, as is palladium (about a third of the price). “After the 2008 financial crisis and the subsequent surge in gold prices [past the $1,000 threshold for the first time on March 13, 2008], we saw increased interest in palladium, particularly as an alternative to white gold,” says Terreni. This time round, however, he has not seen much pick-up for palladium. 

There will no doubt be new platinum timepieces launched at Watches & Wonders, but the precious metal has production complexities that can make producing platinum watches costly. “It’s actually harder and costlier to produce, even for brands like Rolex,” says Hearn. “It’s more labour intensive, and a much harder metal than gold, so platinum [will still be used] to signify special, higher-end pieces that gives an air of rarity, stealth wealth, and exclusivity.”

To put platinum’s standing in the watch industry into perspective, says Hearn, Rolex produces approximately one platinum watch for every 100 gold watches it makes. 

As such, he doesn’t see it as competition for gold watches. “It goes back to the adage of ‘the rich will always be rich’,” he says. “The top brands will always have a loyal customer base that will still purchase with rising costs of raw materials. There are other metals and alloys that brands have used in the past, but the reality is that the lustre and the popularity of gold will mean that it will likely continue as it is.” 

To put this into context with a longer-term view, I remember writing an article in 2008 about the gold price at the time that marvelled at the idea that it could ever break $1,000 an ounce. People were aghast. And it really hit home to me at that time — and has stayed with me ever since — just how sensitive this business is to the fluctuations of the global markets. 

Of course, it did exceed $1,000 — on March 13, 2008 — and it’s been climbing ever since. And here we are, 18 years later, watching as gold exceeds a threshold five times that. 

This article first appeared in the March 2026 edition of Watch Insider magazine.