Swiss watch exports hit record as US becomes top market

by Bloomberg Jan 27, 2022

Swiss watch exports had a record year amid booming demand in the U.S., which overtook China to become the industry’s top market for the first time in more than a decade.

Shipments rose 31% to 22.3 billion francs ($24.1 billion) last year, the Federation of the Swiss Watch Industry said Thursday. The industry has recovered from a 22% decline in 2020, a drop that was on par with the 2009 financial crisis.

The industry could face challenges in 2022 amid further Covid-19 restrictions in key markets including Hong Kong and mainland China, where governments are pursuing so-called Covid-zero strategies. The trade group said it has “cautious optimism” for shipments this year as the industry faces a tough comparison.

The luxury-goods industry has bounced back from the pandemic, helped by consumers accumulating savings during lockdowns and online sales. Strong demand in the U.S. offset slower purchases in Europe, which suffered from a lack of high-spending tourists.

Exports to the U.S. and China rose 55% and 24% respectively in 2021. Shipments to Hong Kong gained 26%.

While the value of exports increased, the number of timepieces and watch mechanisms shipped were still lower compared to 2019 before the pandemic. About 15.7 million wristwatches were exported in 2021 compared to 20.6 million in 2019.

That underscores a trend of increasing demand for higher-end watches. The value of shipments of watches with wholesale prices between 500 francs and 3,000 francs fell 3.5% compared to 2019, while watches above 3,000 francs increased 9.7%.

Swatch Group AG said Tuesday 2021 earnings rebounded, while Richemont had its fastest holiday-season sales growth in at least a decade.