Rolex Price Analysis: Pepsi x Rootbeer
As we conclude the first half of 2024, let’s explore the price progression of two of the bestselling GMT Master models: the Rolex GMT Master 2 Pepsi Jubilee 126710BLRO and Rolex GMT Master 2 Rootbeer 126711CHNR. These models have historically traded at relatively close prices, and have recently experienced a deviation in their secondary prices in their secondary market prices.
Chart 1
Chart 1 reveals that from 2020 to 2023, the price difference between the Rolex Pepsi Jubilee and the Rolex Rootbeer remained within a margin of just over a thousand dollars. What has triggered the recent divergence in price? Today, we will delve into it.
Disclaimer: The secondary prices referenced are the highest recorded prices for each respective year.
Rolex has steadily increased its retail prices over the years. In this analysis, we will track the retail price, secondary market price, and premium for these models.
Disclaimer: The Goods and Services Tax (GST) increased to 8% in 2023 and 9% in 2024.
Chart 2
Table 1
From chart 2, we can see that over the years the Rolex Rootbeer 126711CHNR saw a huge increase in retail from S$19,900 in 2020 to S$24,750 currently, a 24.37% increase amounting to S$4850. Table 1 shows the retail price increases of Rolex GMT Master 2 Rootbeer 126711CHNR over the years. With the retail price hike and the corresponding decrease in secondary market value, the Rolex Rootbeer has seen its premium shrink, from a high of S$22,960 in 2022 to just S$2050 currently.
Chart 3
On the other hand, in Chart 3 we can see that the Rolex Pepsi Jubilee 126710BLRO still commands a significant premium of S$14,000, despite the drop in pricing after the debunked discontinuation rumors in April 2024. The retail price of the Pepsi Jubilee has also risen sharply, from S$12,980 to S$16,000, a 23.27%, or S$3,020. This increase is comparable percentage-wise to the Rootbeer, though the absolute increase is smaller.
Table 2
Table 2 shows the retail price increases for the Rolex GMT Master Pepsi Jubilee 126710BLRO over the years.
The price divergence began in 2023 (as shown in the highlighted area). What could be the cause? These two models, both released at Baselworld 2018, have consistently traded at similar prices since their introduction.
One possible explanation is the sharp drop in the Rolex Rootbeer’s premium. In 2023, the Rootbeer saw a significant decrease in premium, coupled with a 7% retail price increase from 2022 to 2023, a 6% increase from 2023 to 2024, and an additional 3% increase in June 2024. This contrasts with the Rolex Pepsi Jubilee, which has never seen a premium below S$13,000.
There appears to be a correlation between a watch’s premium and its secondary market demand. As a watch’s premium decreases, demand at Authorized Dealers (ADs) drops, with buyers favoring models with higher premiums. This leads to a shortage of models with a high premium like the Pepsi in Authorized dealers further driving up secondary market prices. Conversely, reduced demand for lower-premium models like the Rootbeer at ADs results in an oversupply, driving down secondary market prices. We’ve observed this cycle repeatedly when brands aggressively raise retail prices.
However, this shift does not diminish the value of the Rolex Rootbeer. In fact this makes the Rootbeer an even more attractive value buy. We personally believe that the Rolex Rootbeer is the best two-tone Rolex has ever made. It remains one of the best-selling models in the Rolex catalog and sees the potential for the Rootbeer to to eventually match the Pepsi in price again.