Swiss watch exports have defied economic concerns, showing remarkable resilience and strong growth in June, with shipments surging by 14% YoY to reach 2.4 billion Swiss francs ($2.8 billion), according to the Federation of the Swiss Watch Industry. This buoyant performance comes on the back of robust demand from major markets like the US and China, signaling continued interest in luxury timepieces, despite higher prices and potential economic headwinds.
Sources: Bloomberg, Federation of the Swiss Watch Industry
In the first half of 2023, Swiss watch exports saw a remarkable 12% growth, amounting to 13.3 billion Swiss francs, outpacing last year’s record figures. The US remains the largest market for Swiss watches, with an 8.8% increase in exports in June, following a decline in April, the first in over two years. At the same time, exports to China, the second-largest market, saw a significant 9% rise.
European markets also contributed to the positive trend, with exports to Italy and Germany experiencing strong demand, offsetting declines in Spain and the Netherlands. The overall growth in watch sales cut across all price categories, indicating an increasing appetite for lower-priced watches, a trend that has been beneficial for companies like Swatch Group AG.
Source: Federation of the Swiss Watch Industry
Sales of watches priced between 200 and 500 Swiss francs registered an impressive 19% increase, while timepieces priced between 500 and 3,000 Swiss francs rose by 8%. Even watches in the lowest price category, below 200 francs, saw a rise of 10%, driven by the popularity of Swatch Group’s Omega MoonSwatch.
The Swiss watch industry’s success can be attributed to multiple factors, including the increase in travel, particularly from Chinese tourists who tend to spend more on higher-priced items while abroad. Additionally, a gradual recovery in the 200-500 franc price range has contributed to the industry’s overall growth.
Despite a positive outlook for Swiss watch exports, it is essential to remain vigilant about potential challenges in the global economy. Cooling retail sales in certain markets and the possibility of excess inventory may lead to competition from the grey market. As a matter of fact, Secondhand watch prices kept plunging in July. The luxury watch market index compiled by WatchCharts, comprising 60 watches from the top 10 luxury watch brands based on transaction value, fell 1.2% compared to last month and 13.3% compared to last year.
WatchCharts Overall Market Index