Over the past two and a half years, The price of gold has risen continuously, Surpassing $2, 700 per ounce (international price) and reaching an all-time high.
So, Should the price of gold watches also increase in line with the higher gold price? Why are gold watches more expensive than steel watches? The reason is not as mathematical as you might think.

ⓒ monochrome-watches

How much gold is in a gold watch?

International gold price trend ⓒ investing.com

How much gold is typically contained in a gold watch? Taking the yellow gold Rolex Day-Date, Which is the most traded among watches with gold bracelets, As an example, The total weight of the watch is about 180g (based on a 36mm case). Excluding parts where gold is not used, Such as the glass and movement, About 150g of yellow gold is used. Yellow gold is an alloy of pure gold, Silver, Copper, Zinc, And other metals, And considering that pure gold accounts for 75% of this, The Day-Date contains 113g of pure gold.

ROLEX Day-Date ⓒhodinkee

Then, Theoretically, If you melt down the Day-Date, The value of the gold obtained would be about 14 million KRW, Based on the current price of 117, 500 KRW per gram. Considering that the retail price of the current 36mm Day-Date yellow gold model (reference 128238) is 59.87 million KRW, The value of the gold accounts for about 23% of the price. (Of course, Considering that there is little difference in gold content or weight between current and previous models, The proportion of gold value is much higher compared to vintage or neo-vintage models.)

ROLEX Submariner 126618LB
ⓒ swisstimepieces

As you can see, While pure gold accounts for about 60% of the weight, Its share of the watch price is much lower. However, For the same model, The price of a solid gold watch is several times higher than that of a steel watch. For example, While the Oystersteel Submariner-Date (reference 126610LN) is priced at 14.67 million KRW, The yellow gold model (reference 126618LB) is priced at 57.81 million KRW.

Submariner Date 126618LB

41mm, Royal Blue, Oyster

Submariner Date 126618LN

41mm, Black, Oyster

Day-Date 36 128238

36mm, Champagne/Diamond, President

Day-Date 36 128238

36mm, Champagne, President

Submariner Date 126610LN

41mm, Black, Oyster

Why are gold watches more expensive?

The first reason is that, In addition to the cost of materials, The production cost required to manufacture gold watches may be higher than for stainless steel. It is estimated that labor costs account for the largest portion of watch production costs, And some studies show that the time required to make a gold watch is about 20 to 30% higher than for stainless steel. In addition, Since gold watches are produced in much smaller quantities than steel watches, The facility investment cost per unit may be higher in order to recover the investment in production equipment.

A. Lange & Söhne Datograph Perpetual Tourbillon
ⓒ revolutionwatch

The second reason is the distinctiveness of gold watches. Of course, As times have changed, Stainless steel watches have become the most preferred, But watchmakers with over 150 or 200 years of history started with pocket watches made of precious metals. The concept of using steel in watches began after the Great Depression in 1929, With the need to produce affordable watches. The reason gold watches are sold at much higher prices than steel watches is similar to why steel is classified as a 'metal' while gold is considered a 'precious metal'.

Production ratio by material for Swiss watches ⓒ fhs.swiss

In conclusion

Patek Philippe New Golden Ellipse ⓒ patek

As fashion becomes increasingly casual, It seems very difficult for gold dress watches to regain market share from steel sports watches. However, Gold watches have a unique charm of their own. While steel watches have a modern and cool appeal, Gold watches are considered to have a warmer and more classic elegance. Thanks to the 'old money' trend, Patek Philippe's Golden Ellipse has more than doubled in value compared to before the pandemic, Along with the trend of preferring more understated attire.

In conclusion, It is difficult to explain the impact of gold price fluctuations on gold watch prices with a simple mathematical logic like 1+1. Of course, There may be some influence in terms of manufacturing cost, But the visual appeal and symbolism of gold watches play a much larger role. There must be a reason why ultra-high-end brands like Patek Philippe and Lange make most of their dress watches in gold.

Golden Ellipse 3788

32mm x 26.85mm, Blue

Golden Ellipse 3848/1

32mm x 27mm, Blue/Golden