The Swiss watch industry has been experiencing a historic drop in its figures since the beginning of the year. While exports of its prestigious watches nevertheless amounted to 1.6 billion Swiss francs in September, this is actually a 12% decline compared to September 2019, according to figures published by the Federal Customs Administration.
While the decline in exports is steadily increasing, the situation has not been getting any better since January.
Indeed, between January and September, it was a real shock for the Swiss watch industry, with an overall drop of 28.3% to 11.4 billion Swiss francs. In August, the Federation of the Swiss Watch Industry (FH) reported a drop of nearly 12% in exports over one year to 1.3 billion Swiss francs, or 1.2 billion euros.
According to the indications made this Thursday by the FH, it is the entry-level watches (less than 200 euros) that have been the most affected during this fall. And with good reason, given the growing decline in tourists around the world and the global health measures applied to all production plants and other service providers in this trade.
In total, watch exports have fallen by 30.5% since January 2020 compared to 2019 for the same period.
The various exported pieces show more or less different figures. Indeed, timepieces worth around 500 Swiss francs in export show a decline of 23.9% in value, a drop in the number of pieces exported of 30.5%. The same applies to timepieces worth more than 3,000 Swiss francs, which fall by 13.5% compared to September 2019.
Nevertheless, one branch still manages to pull through and that is watches in the 500-3000 Swiss franc range, with the first growth since the beginning of the pandemic amounting to 2.7% of exports.
The watch industry regains hope despite its difficult start to the year and notes a positive trend in its exports. In April, the industry recorded a record drop of 81.3%, then 67.9% in May, 35.1% in June and finally 17% in July: “The trend in Swiss watch exports remains negative, but the initial shock is gradually being absorbed,” indicated the watch federation in one of its press releases.
One country in the world stands out more than the others: China. While the rest of the world is falling back on international trade, watch exports to China are recovering strongly and growing by 44.9%.
The Chinese market is proving to be solid in the face of the pandemic and is redoubling its efforts to keep up the trend and maintain the balance with its neighboring countries in weakness. As a result, all luxury goods have been repatriated there since January 2020, unless they are not exported to importing countries. According to the FH, exports to China have miraculously increased by 78.7%, i.e. 18.1% of total Swiss watch exports.
It is therefore a regression that can be seen in other countries of the world in free fall, such as the United States with a 13.8% drop, Japan (-26.8%), Singapore (-24.7%), Hong Kong (-15.8%) and South Korea, which is in a record drop of 52.3%. In Europe, due to new waves of containment and tighter health restrictions, exports fell by 19.2%.
On the Swiss stock exchange, the figures recently showed an increase in Richemont and Swatch shares, struggling a little more than its competitor to recover, up 1.7% to 63.68 Swiss francs and 0.2% to 211.20 Swiss francs respectively.
Featured photo: © Baume
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