I’m always on the lookout for intriguing connections between the automotive sector and other industries—insights that I can share with TaaSMaster subscribers. Recently, I’ve noticed that many TaaSMaster readers have a strong interest in luxury watches as well. While I don’t have hard data to prove this, my experience suggests that a significant number of people in the car business—automotive executives, dealers, and auto journalists in particular—are also luxury watch buyers.
With that in mind, I found the latest Acquired podcast episode especially compelling. It’s an in-depth, five-hour exploration of Rolex. If you’re unfamiliar with Acquired, The Wall Street Journal described it as “the business world’s favorite podcast.” In this Rolex episode, hosts Ben Gilbert and David Rosenthal make a direct comparison between Rolex and a specific automaker.
To appreciate the comparison, it helps to understand the hierarchy of luxury watch brands. Collectors, horology experts, and industry professionals consider Patek Philippe, Audemars Piguet, and Vacheron Constantin the “Holy Trinity” of watchmaking—brands that embody the highest levels of craftsmanship, innovation, and artistry. Rolex, by contrast, is known for durability, precision, and mainstream luxury, but rests on a lower level than the “Holy Trinity” watch brands.
In the podcast, Rolex is likened to Porsche, while Patek Philippe is compared to Ferrari. The reasoning? Rolex watches, like Porsche automobiles, are high-quality, impeccably engineered, and manufactured at scale, with exceptionally strong profit margins. Like Porsche, Rolex sticks to a few core models, refining them once or twice per decade. The Rolex Submariner, for example, is compared to the Porsche 911. Just as a 911 buyer today is purchasing a modernized version of what his grandfather could have bought 50 years ago, the same is true for Submariner buyers.
Patek Philippe, on the other hand, operates more like Ferrari, not catering to mainstream consumer demand. Its watches are made for collectors. Patek watches have small production volumes with average retail pricing of around $40,000. While Rolex sells some $40,000 timepieces, the average price consumers pay for one of its watches is closer to $13,000.
The Rolex-Porsche analogy only goes so far in my opinion. Rolex is the highest-volume Swiss watch brand in terms of both annual production and revenue, capturing 30% of all Swiss watch industry revenue. Porsche is only a mid-tier luxury automaker by sales volume.
Porsche’s future trajectory will be particularly interesting to watch as disruption continues in the automotive industry. As I wrote in “Betting Big or Hedging Their Bets? How Legacy Automakers Are Navigating the EV Transition,” Porsche has already begun “tapping the brakes” on its EV expansion in response to slowing EV sales growth in some regions, and intensifying competition from Chinese automakers in China.
The Swiss watch industry, including Rolex, faced its own period of disruption during the 1970s and 1980s—a time known as the “Quartz Crisis.” The rise of highly accurate and affordable quartz watches from Japanese and American brands severely disrupted the Swiss mechanical watch industry.
Yet Rolex not only survived the disruption, it emerged as the most famous watch brand in the world.
So, what about Porsche? Will it continue to thrive and grow, or will this disruptive period mark the beginning of its decline?