Classic luxury watches, including sought-after brands like Omega and TAG Heuer, are increasingly being melted down for their gold content across the UK as record gold prices make the metal inside more valuable than the watches themselves. Dealers and industry experts report a rising trend throughout 2024, where vintage and contemporary pre-owned watches are scrapped instead of auctioned.
Gold Price Surge Drives Trend
Gold prices have reached unprecedented highs, spiking as high as $5,600 an ounce earlier this year before stabilising around $4,200 an ounce. This surge means the intrinsic gold value in watches often surpasses their resale price, pushing owners and dealers towards melting valuable timepieces rather than selling them.
Omega And Tag Heuer Hit
British dealer Jon White of Gold Traders revealed he scrapped an 18-carat Omega Constellation from the 1970s, which had a gold value roughly 35% higher than its auction estimate. Other models from brands like TAG Heuer and LVMH’s portfolio are particularly vulnerable, as their resale prices haven’t matched gold’s escalations.
Unsold Stock Also Destroyed
James Lamdin, founder of Watches of Switzerland’s Analog Shift, confirmed that not only used watches but also large volumes of brand-new, unsold Swiss watches with gold parts are being melted down due to overproduction. This phenomenon underscores the imbalance between manufacturer supply and market demand in the luxury watch industry.
Collector Watches Remain Protected
In contrast, tightly controlled brands like Rolex and Patek Philippe continue to command premiums well above their gold melt value, supported by long waiting lists and collector demand. This has preserved the value of rare and vintage pieces despite soaring gold prices.
Industry Reactions And Concerns
Horological historian Adrian Hailwood lamented the loss of heritage watches, calling the melting of historically significant pieces “a short-sighted tragedy.” Many owners keep sentimental watches precisely because they oppose their destruction. However, the financial incentive linked to gold content remains a powerful force behind this shifting trend.
