Gold has been in the news recently as its price has surged to record highs, driving up the cost of gold-based watch models. A year ago, Swiss watch companies were paying about $2,300 an ounce; today, the price is closer to $3,300, a 40 percent increase. Switzerland remains the world’s largest importer of gold.
In response, Rolex raised prices on its gold watches by 8 percent earlier this year, following two increases in 2024. In May, it applied an additional 3 percent hike due to new tariffs. A further adjustment might soon be on the horizon.
(Source: FT)
More than ever, Rolex has turned gold recycling into a competitive edge through its little-known "circular gold" system. From washing filings to incinerating polishing cloths, Rolex tracks its gold with care, using a digital system that applies strict limits on material loss. Each gram of gold recovered is one less gram of gold to extract from a mine.
Metals filings, dust, offcuts — all are meticulously tracked, processed and reused, allowing Rolex to minimize costs and environmental impact while other brands pay the price of rising gold.
One way Rolex has a competitive advantage is that it has developed a one-of-a-kind recycling process. Today, a staggering 91% of gold Rolex uses for its watches is recycled; just 9% is mined.
(Source: Rolex)
While Rolex still purchases some recycled gold externally and is therefore exposed to market fluctuations, most of its recycled supply comes from internal processes. When buying recycled gold from suppliers, traceability is always a concern for the brand, but it says it has been able to guarantee 99% traceability of its gold supply since 2020.
“The recycled gold we buy from the watchmaking and electronics industries is traced down to the supplier of our supplier, which is the current goal we aim to achieve,” Rolex said.
Rolex's biggest savings as gold prices rise come from what it calls “circular gold,” which makes up most of its recycled supply and is recovered primarily from its own production waste.
“Circular gold aligns with our strategy to minimize the loss of precious metal during manufacturing processes,” Rolex said.
(Photo credit: Rolex)
When gold prices increase, watch brands face higher production costs, as a gold watch case is typically machined from a bar that weighs up to five times more than the finished product. Although scraps can be recycled, the initial material cost remains significant.
At Rolex, all materials that come into contact with gold are carefully handled to maintain an exceptionally low inventory loss rate.
“Because our industrial expertise allows us to reach a close-to-zero loss rate during the manufacturing of our gold parts, our [recycled] model is one-of-a-kind,” Rolex said.
The brand says the gold circulates continuously within its production infrastructure. To achieve this, it has developed its own process which it says is unmatched in the industry and allows for nearly 100% recovery of precious metal waste.
(Photo credit: Rolex)
Rolex divides its recovered material into three main categories: metal filings, dust and offcuts. Each is handled differently.
-Metal filings: this waste is pretreated and titrated internally, then refined externally in segregated flows dedicated exclusively to Rolex.
-Dust: this waste is sorted internally then shipped and processed by external refiners.
-Offcuts: this waste, unlike metal filings, does not require external processing and is directly reinjected into production after going through Rolex's own foundry. This shorter processing loop is less energy-consuming, the brand said.
(Photo credit: Rolex)
Circular gold is recovered and continuously reinjected into production until it is transformed into a finished product, saving money as the price of gold surges on the market.
“This optimized use of circular gold means that we do not need to offset potentially significant losses with new purchases of mined or industrial gold,” Rolex said.
In order to minimize losses during the different manufacturing steps, Rolex has developed a strict tracking system for its gold. At every stage of the flow, there is a systematic weighing that occurs, a process that relies heavily on employee accountability.
The precious metal entrusted to an operator is quantified at each workstation using a digital tool, with an extreme tolerance threshold regarding losses, defined for each sector.
Rolex employee. (Photo credit: Rolex)
At the end of this process, the employee transfers the responsibility of the precious material to the next operator. The digital tracking of each manufacturing order traces all this data, which is then consolidated during inventory.
The metal filings are washed, wrung out, washed again, compacted, shot-peened and titrated before being entrusted to an external refiner with segregated flows exclusively dedicated to Rolex. The machine oils are also treated twice in order to recover even the smallest gold particles.
Because gold dust is likely to settle on cleaning cloths, machine filters or on the abrasive strips used for polishing, these items are regularly incinerated. In 2024, these burning operations allowed Rolex to recover "significant quantities" of gold, the brand said.
Perpetual 1908, 18 ct yellow gold. (Photo credit: Rolex)
Thanks to its financial wherewithal, Rolex has been able to develop machines specifically designed to minimize precious metal loss. The brand says it uses tools without nooks or sharp angles where gold could accumulate, and its machines feature automated cleaning programs.
But the machines are only part of the story. What sets Rolex apart further is the human expertise it has refined over decades of working with precious metal.
At Rolex, anyone handling gold undergoes targeted training for their specific roles — from the foundry to shaping, stamping, machining and finishing the material. Each step requires specialized knowledge, backed by internal checks that ensure every link in the production chain meets the high standards long associated with the Rolex name.