PARIS – Could the Swiss watch industry’s woes be over in 2025?
Export of timepieces returned to growth in January, according to figures published Thursday by the Federation of the Swiss Watch Industry. They rose 4.1 percent year-on-year to 1.9 billion Swiss francs, or $2.1 billion at current exchange rates.
The U.S. continued to lead, with the top market for Swiss timepieces growing 16.2 percent.
The polarization of the market continued to be visible in figures by price segment, with the luxury segment showing stronger recovery.
“Price rises, the U.S. and lowest and most expensive watches drive strong exports,” Jefferies analyst James Grzinic wrote in a trading note. “This is driven by major price rises in both the cheapest and the more expensive timepieces, as well as a strong inventory rebuild in the US.”
Sales in mainland China “remain very weak,” he added.
The downward turn in demand for Swiss timepieces in Greater China continued as the mainland and Hong Kong showed declines of 29.1 percent and 11.7 percent respectively.
Japan was a bright spot in Asia, with sales up 26.2 percent in the island nation, as the weak yen has hit a low against the dollar, spurring on high profits for the country’s car exports and sending the stock market soaring.
Demonstrating the bifurcation of the market, watches at both the high and low end saw growth, while the middle lost ground.
Watches under 200 Swiss francs at export price grew in value by 0.7 percent, although the industry body noted that they “remained at a level close to their 2024 performance.”
The mid-range continued to decline in volume and value by high single-digits.
High-end timepieces, priced over 3,000 Swiss francs at export price, grew 7 percent in value and by 0.6 percent in volume.
But this may not signal the end of luxury woes as a mixed picture emerged from the breakdown by materials.
While precious-metal watches and gold-and-steel models grew 9.7 and 8.9 percent in value respectively, their volumes contracted by 3.6 and 1.5 percent. Meanwhile, steel watches continue to lose ground in volume, dipping 2.4 percent, while the number of units leaving the country rose by 5 percent.
Price growth at the high end comes as precious metals have skyrocketed.
Gold prices hit their all-time high at the end of January at $2,798 per troy ounce, up 7 percent and surpassing its previous high in October 2024. Traders have been stockpiling gold, with commodity traders in the U.S. increasing inventory 75 percent since the U.S. election in November, causing shortages in other markets.
Other metals including silver and platinum have also seen prices rise, around 2.5 percent each.
Branded timepieces and hard luxury continued to generate strong interest from consumers, continuing a pattern of consumers seeking marque names. Cartier and Van Cleef & Arpels were two brands that continued to do well with consumers, Grzinic noted.
