Vacheron Constantin

Preparing to bid at auction: a case study

 

There are many ways to purchase a fine timepiece, and all can be a great way to bring interesting watches into a collection: brand new from a brand boutique or authorized retailer, preowned from secondary dealers, collector to collector, and at auction. I have had good experiences with every method, but with the exception of purchasing brand new watches from authorized sources, one must perform some due diligence before committing to a transaction. I will look at the process through a consideration of Lot 20 at the upcoming auction at Sotheby’s in Geneva, a Vacheron Constantin Saltarello, reference 43041, in white gold, from the limited edition of 500 pieces (200 in white gold, 200 in rose gold, and 100 in yellow gold).


The first step is to ensure the authenticity of the timepiece. In looking at Vacheron Constantin in the secondary markets, especially on the vintage side, we see a number of what we endearingly call “Frankenwatches,” where a watch is pieced together from several different watches. The parts might all be authentic Vacheron Constantin, but the particular timepiece is not a correct Vacheron Constantin. If the watch comes with the original box and papers, (always confirm that the serial number on the watch matches that printed on the papers....I wouldn’t mention it if I hadn’t seen such mismatches in the past), then that brings a level of comfort. Without documentation it is best to get both the case and movement serial numbers and have Vacheron Constantin issue an extract from the archives.  When buying from an auction house, read their fine print regarding authenticity and buyer’s recourse should the timepiece prove to be incorrect. In general you can count on their standing behind what they offer, but they sometimes have frankenwatches show in their catalogs (and will remove them if they learn that the pieces are incorrect). I have no concerns about the authenticity of Lot 20.


Next is to consider the condition of the timepiece. What shape are the case, dial, and movement in? Has the case been overpolished or does it exhibit damage via dings and dents? Can it be restored? Is the dial spotted, oxidized, reprinted? Does the movement run and function correctly? Will it need service? As a rule of thumb, the buyer should always consider that he’ll be on the hook for a servicing in short order, and should factor that into the purchase price. Regarding Lot 20 Sotheby’s states, “The automatic movement is running at the time of cataloguing. However it might benefit from a service in the near future. Dial in very good condition. Case with moderate noticeable scuffs from wear. MVT no : 861141.”  What they missed is that the applied Maltese Cross is missing from the dial....only the two feet that hold it into the dial are there! This makes me concerned that the watch has had a significant impact in the past. Also, someone got inside the watch and removed the missing Maltese Cross: did they damage anything? I would factor a full service into my bid, which will include Vacheron Constantin refinishing the case, servicing the movement, and either restoring or replacing the dial. Vacheron Constantin’s list price for servicing a “petite complication” is $1449, and a dial restoration is $1503. The price of a new dial is unknown, but the question should be asked of Vacheron Constantin before bidding. Allowing for unknowns, I would expect service costs to run to $4000+ on Lot 20.


I also contemplate the completeness of the package. Does the timepiece come with all boxes and papers? If not, what is missing? For vintage Vacheron Constantin watches of a certain value, ($10,000 is my personal threshold), if the papers are not part of the transaction, then I would want a Certificate of Authenticity. This has a cost of approximately $1065. For watches under that threshold value, Vacheron Constantin now offers an extract from the archives, valued at $188 and which does not require the timepiece to go to Geneva for authentication.  The Sotheby’s catalog state that Lot 20 comes with certificate and presentation case. If bidding, I would ask to see them, to make sure everything matches.


Finally, I need to determine the value: What am I willing to pay for a particular timepiece? With respect to buying on the secondary market, comparable sales play into my calculus, but so will expected service costs. In 2012, a white gold Saltarello sold at an Antiquroum auction for  CHF 18,750, which is about $20,000 in today’s exchange, and that included buyer’s premium (clearly defined in the auction catalog, and in the case of Lot 20, it would be a 25% premium to the hammer price: if the hammer price is CHF 16,000, the buyer will pay CHF 20,000). That Antiquorum watch had a condition report that indicated the watch looked like new.  Considering all the work that definitely needs to be performed on Lot 20, and assuming I felt a mint example would be worth $20,000, I figure my maximum bid would have to have my paying a maximum of $16,000 for the watch to allow for the material service costs that the buyer will have to shoulder to get the watch back to mint condition. In this case, I would stop bidding at the low estimate of CHF 12,000. The buyer’s premium would make my immediate cost CHF 15,000 (~ $16,000 at current exchange rates). Service costs would make take me to $20,000. If I got Lot 20 for less, then I would think I got a great deal. I would be disciplined and not bid any higher.


It will be interesting to see what actually happens (Full disclosure: I will not be participating in this auction).


Bill
VC Forum Moderator

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