What Is Really Causing the Delay in Production of Popular Watches?

Walk into any authorized dealer for a major Swiss watch brand and you will encounter two simultaneous realities. In one reality, the brand 'simply cannot produce enough' of the models everyone wants — they are sold out, the waitlist is years long, there is nothing they can do. In the other reality, filling the display cases is an abundance of watches that nobody is buying. Both realities coexist. The question worth asking is: which one is actually true?

Last week, we at The Watch Pit highlighted how we regularly find surplus stock selling at 40–80% discounts, which is unsurprising in an industry that, in our strong opinion, is oversupplied and overpriced. This week, in the essay below, we break down the cause-and-effect of the 'severe shortage' in some brands' offerings. Most of you would have heard of the impossibility of getting models such as Rolex Sports & Divers, Audemars Piguet's classic Royal Oak, Patek Philippe's Nautilus, Vacheron Constantin's Overseas, as well as selected popular models at brands such as small independent brands (like Grönefeld) and more well-known brands like A. Lange & Söhne and Zenith.

How much of this is due to an overwhelming uptick in demand, and how much of it is due to disrupted supply lines, inability to recruit talented watchmakers, and inability to access component parts? We examine each in turn.

The Scale of Swiss Watch Manufacturing

Rolex produces an estimated one million watches per year. Omega produces several hundred thousand. Patek Philippe produces approximately 70,000 per year — a figure that is frequently cited as evidence of their exclusivity but which actually represents a substantial industrial output for a luxury goods manufacturer. These are not small artisan workshops. They are sophisticated industrial operations with significant fixed capital, vertically integrated supply chains, and decades of manufacturing experience.

The claim that these operations cannot produce more of a popular reference if they chose to requires a significant suspension of analytical judgement. Rolex's manufacturing facilities in Geneva and Biel are large. Their workforce is skilled and substantial. Their financial resources — the brand is reportedly one of the most profitable luxury goods companies in the world on a per-unit basis — would easily support capacity expansion if that were genuinely the priority.

The Allocation Decision vs. The Production Decision

Even if we accept at face value that certain components are genuinely constrained — specific bracelet configurations, particular dial variations — the allocation of those constrained units across the dealer network is a separate decision entirely. A brand can choose to distribute constrained supply as broadly as possible, maximising the number of genuine collectors served. Or it can concentrate allocation in a small number of high-value markets and high-tier dealers, maximising the desirability signal.

The evidence consistently points to the latter approach. Popular references are concentrated in flagship dealers in key markets. They are rarely seen in smaller markets or lower-tier dealers. This is not production capacity at work — it is distribution strategy. The scarcity you experience as a consumer in a mid-tier market is not a function of the factory. It is a function of the brand's decision about where to send what they make.

The Overproduction of Unwanted Models as Direct Evidence

The most compelling evidence that production delay on popular models is a choice rather than a constraint is what sits in plain sight on every AD's display shelves. Every Rolex dealer in the world has ample supplies of Oyster Perpetual models. Every Patek Philippe AD has Date models and Calatrava references available. These are not scarce. They are abundant.

The same manufacturing capacity, the same supply chain, the same workforce that allegedly cannot meet demand for Submariners and Daytonas — is simultaneously meeting and exceeding demand for models nobody is rushing to buy. This is arithmetically impossible to reconcile with the production constraint narrative. The factory produces what the brand tells it to produce. The brand has decided to produce fewer Submariners and more Oyster Perpetuals.

The Subcontractor Secret: Only Three Brands Are Truly Vertically Integrated

Did you know that Swiss luxury watch brands rely heavily on subcontractors for parts and services? While many believe top luxury watch brands make most or all component parts in-house, nothing can be further from the truth. Only THREE watch brands are completely vertically integrated — Rolex, Seiko, and Citizen. All other brands obtain parts and services from sub-contractors.

For an idea of how deep the subcontractor dependency runs, a widely circulated supplier list (originally compiled by aBlogtoWatch) documents dozens of specialist manufacturers producing movements, cases, dials, hands, bracelets, and springs for the brands whose names end up on the dial. The brand you buy is, in most cases, an assembler and marketer of components made by a network of independent specialists — many of them shared across competing brands.

The China Supply Chain: The Best-Kept Secret in Swiss Watchmaking

Many component parts are also sourced from China — and this is one of the best-kept secrets the Swiss watch industry wants to keep from you to maintain the Swiss-luxury-veneer. The 'Swiss Made' label requires only that 60% of the parts and services are sourced from Switzerland; the remainder can come from elsewhere, and increasingly that elsewhere is China.

Read those figures carefully. China is not a marginal supplier — it is the single largest external supplier of parts to the Swiss watch industry. When China's supply chain was disrupted by strict COVID lockdowns, port shutdowns, and pandemic logistics, the impact on Swiss production was direct and material. The brands that publicly blamed 'overwhelming demand' for their shortages were, in several cases, actually contending with a disrupted upstream supply chain they did not want to acknowledge — because acknowledging it would mean acknowledging how much of a 'Swiss' watch is not, in fact, made in Switzerland.

Made in China: Brands That Admit It, and Brands That Don't

Not every brand hides its Chinese sourcing. One is SevenFriday. Daniel Niederer, its founder, spent 10 years distributing watches in Asia before establishing his own brand. He sells watches that are designed in Zurich and made in a factory in China. Other Swiss brands are also said to source their watch cases and dials from there.

The Watchmaker Salary Problem: Structural, Not Cyclical

Can't get the watch you want? Were you told there is currently a delay in production due to overwhelming demand? In our opinion, this belies the fact that the manpower side of the Swiss watchmaking industry has long-standing structural issues. The conventional wisdom — that Swiss watchmakers are well paid, yet hard to attract, recruit, and retain — is inaccurate. The truth is more uncomfortable.

The 2014–2017 Contraction and the COVID Mask

The manpower crisis did not begin with the pandemic. In the period 2014–2017, the Swiss watchmaking industry already suffered a contraction, and grew for the first time in 2019. The jobs that disappeared during that contraction were not all replaced — and the watchmakers who were laid off were not all re-hired when demand returned.

State aid was provided to the watchmaking industry during the COVID pandemic, but it masked deeper problems. As Grégory Pons, a French journalist based in Geneva who specializes in watchmaking, warned: 'Massive State aid has masked the true extent of the crisis suffered by the branch. Waves of layoffs and the demise of dozens of brands can be expected once short-time work and business loans have ended.' The aid preserved headcount on paper while doing nothing to address the structural salary and retention issues that predated the pandemic.

The Three Questions The Watch Pit Asks

Only by answering these questions properly will there be a more objective truth and clarity to these issues. We put them directly to the industry and to our readers:

Why the AD Distribution Agreement Matters

Authorized dealer agreements with major watch brands typically require dealers to take a balanced mix of inventory across the brand's collection. To maintain authorized status — and to be included in allocations of desirable references — dealers must accept slow-moving inventory as part of the package. This is not an incidental arrangement. It is a structural mechanism by which brands ensure distribution of their full catalogue.

The consequence is that ADs are financially motivated to maintain the desirability of popular references: those allocations justify taking on the less-desirable models they cannot easily sell. If every reference were easily available, the business case for accepting slow inventory disappears. Scarcity in the sport watch segment subsidises clearance of the full collection across the dealer network.

The True Value of the Waitlist

A waitlist for a luxury product is one of the most powerful marketing instruments that exists. It signals that demand exceeds supply — the fundamental driver of desirability. It generates sustained media coverage as journalists report on years-long waiting times. It creates an ongoing conversation in the collector community and general media that keeps the brand top of mind at zero marketing cost. The waitlist is not an unfortunate byproduct of genuine production constraints. It is a feature.

Our Position: Horological CounterCulture

We are a Horological CounterCulture investigative media company and have no commercial interests in the companies or sales we cover. We are only here to expose the industry for what it truly is — and yes, we love (and will continue to love) watches too. The impact of excess supply and over-pricing are our core research subject areas, and we aim to expose the truth in the quest to uphold consumer rights and corporate accountability.