It's Comeback Time For Luxury Watches - NYTimes.com

Luxury watches are back, especially if they are encrusted with diamonds or endorsed by celebrities, living or dead. This holiday season, some of the richest Americans parted with more than $10,000 for a timepiece, joined by plenty of the only slightly more downtrodden, for whom a $1,000 watch was suddenly the gift to give.

Rolex, often called the Rolls-Royce of watches, has not made its reputation on new models -- its traditional ones often have waiting lists. But a few months ago, even Rolex introduced a new limited edition, with a ring of green instead of black around the bezel. Cartier also came out with a new watch for the holidays: the $3,450 Roadster for women.

But Raymond Weil, another status brand, is still struggling, he said. ''They didn't come up with any new styles, and what they had they didn't ship well; they weren't at the top of their game.''

*** Fortunoff, an executive vice president at Fortunoff, said the fourth quarter was ''driven by men's sports watches: Breitling, Tag Heuer and Omega.'' On the ladies' side, Mr. Fortunoff said, Baume & Mercier and Movado were the winners.

The country's leading watch dealers said in interviews that consumers will want more watches with diamonds on the outside as well as more technically advanced sports watches like the Tiger Woods Link Calibre 36 by Tag Heuer, which sells for a cool $5,000 (and is sometimes sold out), and the Emergency watch by Breitling, complete with a beacon to summon rescuers. Buyers must sign a waiver abso *** ing the manufacturer of responsibility if the beacon is set off accidentally and the Coast Guard responds en masse.

''We had a very strong holiday,'' said Andrew J. Block, senior vice president for marketing at Tourneau, one of the country's biggest watch dealers. ''I can't give you the numbers, but the increase was well above what the analysts were projecting: 3 to 5 percent. With some brands, the increase over last year was in the double digits.''

At Saks Fifth Avenue, $1,000 watches by Michele sold out -- and did well throughout the country; buyers were attracted to the diamonds that circle the watch, the brightly colored starfish skin and alligator bands, and, of course, the low price -- relative to the Cartier and Tiffany diamond-encrusted watches, that is.

''Jewelry, especially fancy, high-priced watches, rose 35 percent over last Christmas,'' said C. Britt Beemer, chairman of America's Research Group, which polls both shoppers and retailers. ''For corporate executives, C.E.O.'s and Wall Streeters, the watch is now as much a status symbol as the car they drive. It was the big gift they gave themse *** es this Christmas.''

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Companies like Tag Heuer and Harry Winston are expanding both up and down the income scale. Tag Heuer is working with Mr. Woods to develop a new golfing watch (90 percent of golfers do not wear watches, Tag Heuer says) and has reintroduced the Monaco, the watch worn by Steve McQueen when he raced cars at Le Mans, which retails for as much as $12,000. Ten days before Christmas, it also introduced a line of less expensive watches called Formula One, with red, blue and black dials, for $600 to $800.

The watch industry is gearing up to give customers what they want.

Watch retailers are definitely in good spirits these days.

Harry Winston now sells what a spokeswoman called ''classic, everyday watches'' for $6,000 to $11,000. But Winston has not deserted its billionaires: it will introduce the Opus IV at the Basel Watch Fair in April. The price? Around $200,000. Not to be outdone, *** *** , which started making watches a year ago, is introducing the Tourbillon on Feb. 10, for roughly the same price.

While the luxury watch business -- from jeweled timepieces by Tiffany and Harry Winston to sports models by Tag Heuer and Breitling -- was hit hard after the Sept. 11 attacks, pollsters, retailers and watchmakers say this was the Christmas that brought the return of the buyer who wants more than just something to tell the time.

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People are also requesting more ''entry level'' watches, which, dealers say, run from $295 to $600. And the more complications -- industry code for elaborate functions like the emergency beacon -- the better.