20. time-business


Aurel Bacs: “Brands have shifted from rejection to acceptance”

PHILLIPS/BACS & RUSSO

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March 2019


Aurel Bacs: “Brands have shifted from rejection to acceptance”

The famous watch auctioneer explores the radical change in the attitude of most brands when it comes to the secondary market, which is booming while sales of new watches are stagnating. If brands are rushing to enhance the value of their historical assets, it is because they now have a clear understanding of where their economic interests lie.

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nyone who attended the last watch sale of 2018 organised by Phillips, “Styled”, in New York, would have understood immediately the extent to which the secondary market has become the real meeting place for watch aficionados. One could sense the enthusiasm and almost physical thrill that are too often lacking during the larger, more formal events organised by brands. It is here that the living, beating, public heart of watchmaking is at its best.

Paradoxically, then, an industry that is trying to look to the future needs to turn to the past to find the freshest, most dynamic and modern image of itself. After all, watchmaking is a matter of time... And time is the ruthless master that will judge the few models that will go down in history, those that will fall under the hammer of Aurel Bacs, setting them apart from the ephemeral existence of most timepieces.

Things have come a long way indeed since the first major thematic auctions organised by Osvaldo Patrizzi in the 1990s. A Phillips sale has become the most visible and prestigious face of a revolution, that of the second-hand watch. Here, collectors’ models often increase their initial value tenfold, while far away, in the darker corners of the internet, watches change hands for a tenth of their marked price. These are different planets of the same bubbling universe, one we are looking at with increasing interest.

Aurel Bacs shares with us some thoughts on the evolution and possible future of this universe.

Aurel Bacs, Senior Consultant at Phillips in association with Bacs & Russo
Aurel Bacs, Senior Consultant at Phillips in association with Bacs & Russo

Europa Star: Alongside the launch of the Apple Watch and the fantasies it fosters, vintage watches are doing better than ever. Why?

Aurel Bacs: I remember when the Apple Watch arrived, we thought it might be once again, as it was in the 1970s, a sign of a weakening of the mechanical watch. But there is one difference – and it is significant: the debate surrounding the “quartz crisis” was about performance. However, today I don’t know anyone who buys a vintage watch for its performance. People buy it because it is a work of art on the wrist. If I had to give you one word to help you understand watchmaking today, it would be “culture”. And by that, I mean intellectual, emotional and aesthetic stimulation. In the same way, we don’t drink a vintage wine just because we are thirsty, or choose a painting just to cover a white wall!

So you’re saying that, paradoxically, the Apple Watch has actually enhanced the appeal of vintage watches?

I’m grateful to Apple for the launch of their smartwatch, because it’s far easier to appreciate things when they’re set in contrast. We enjoy a cold drink when it’s hot and a hot drink when it’s cold. We have seen an extraordinary rejuvenation in our industry. The new generation wear cheap T-shirts and use disposable phones, and that’s why they’re looking for “content” - I hate the word storytelling, which is closer to fantasy in my eyes. A watch, like a sculpture, is a three-dimensional object. But a vintage mechanical watch also has a fourth dimension: the origin, the history, the uniqueness, the patina, the age...

Aurel Bacs: “Brands have shifted from rejection to acceptance”

How, in your opinion, have the brands’ attitudes evolved in terms of how they manage their heritage?

I see a huge change. A few brands certainly do not need to change: the Stern family has been embracing its heritage with Patek Philippe for forty years. But most brands, until twenty years ago, considered vintage watches, auction houses and myself to be a disruption, even conflictual. Today we are working together, because we have all understood that a brand that is proud of its past can neither deny nor ignore its history. Many brands are making extraordinary efforts and significant investments to promote their past.

So their attitude towards you has changed?

Today, when we call a factory, we are very well received, unlike twenty years ago! The reaction is immediately: “Mr Bacs, how can we help you? The archives, pictures, an opinion, advice?” We also see more and more brands promoting their vintage collections on social networks. You can’t be proud of a Speedmaster, an Aquatimer or a Memovox and say simultaneously: don’t tell us about our past! I think we’re seeing in contemporary collections that this dialogue also appeals to brands.

The trend is so strong that brands are starting to do your job for you! Whether it is Vacheron Constantin with its Hour Lounge programme, MB&F, F.P. Journe or Breitling, brands are now buying up vintage models, restoring them and selling them... Twenty years ago, they accused you of competing with them; is the competition reversing itself?

No. On the contrary. All these initiatives are complementary, as they give confidence to the market. Imagine that thanks to the efforts of a manufacturer, its vintage timepieces experience a 10% increase in value. And that one in ten vintage watches no longer comes to us, because they take care of it. With the nine pieces I have left, at 10% added value, I’m compensated for that tenth watch.

Aurel Bacs: “Brands have shifted from rejection to acceptance”

Do brands use your services to recover their heritage?

The brands consult us to find out more about the auction market, the community of vintage collectors and their reasoning. Brands have asked us the following question: “We have launched a new product that is waterproof to 100 metres, accurate, reliable, SuperLuminova, guaranteed for two years, priced at 10,000 francs, and a collector pays you 30,000 francs for the same model from the 1950s, which is no longer under warranty, which is smaller, perhaps a little damaged: explain it to us!”

According to your estimates, what is the size of the global secondary watch market?

We can talk in billions of francs. It’s impossible to find that number. In real estate, it is much easier because there is the land registry. For cars, we can base ourselves on changes to the registration documents. In watchmaking, we have nothing!

Can we expect to see new auction records? And what room is there for outsiders, alongside the dominant duo of Rolex and Patek Philippe?

I really don’t see any wristwatch on the horizon that could beat the record of 17 million francs established by the Rolex Paul Newman in 2017. Today, we know about 95% of the great Rolexes, about 95% of the great Patek Philippes. I’m not saying that we have reached saturation, but when an average Daytona auctions at over 100,000 francs, I understand that there are collectors who can no longer afford to follow the market, or maybe their wives are starting to put pressure on them! This is one reason why we are seeing the emergence of vintage models from Zenith, Heuer, Omega, IWC, Tissot, Jaeger-LeCoultre and Longines. With this phenomenon, in the end, the polarisation of sales will decrease, in my opinion.