Swiss watch exports post surprise jump after US revival

Monthly Swiss watch exports posted a surprise gain in April as a revival in demand for premium and luxury timepieces in the US and Japan offset continued weakness from China.

Shipments rose 4.5% by value to 2.1 billion Swiss francs ($2.3 billion) in April from a year earlier, the Federation of the Swiss Watch Industry said Thursday. The increase follows a sharp drop the month before. They were helped by an 11.6% jump in exports to the US, the biggest market for Swiss watches, which reversed a fall suffered in March.

Vontobel analyst Jean-Philippe Bertschy said the monthly stats were “surprisingly strong,” pointing to a good showing from high-end brands such as Rolex, Patek Philippe and Cartier. “The other brands, especially in the lower segments, are still in a reset mode after an extravagant post-Covid period,” Bertschy said in a report.

The surprise jump comes amid falling global demand for Swiss timepieces, which enjoyed an unprecedented boom after pandemic lockdowns ended in 2021. 

Higher interest rates, shaky economic growth and geopolitical conflicts have since prompted buyers to rein in their spending. Watchmakers are also grappling with the continued strength of the Swiss franc against other currencies that has spurred price increases in some markets and deterred customers.

Shipments to Japan surged 13.6% as the weak yen continued to drive sales from tourists, while demand from China remained tepid in April, with exports to the second biggest market for Swiss watches down 7.5%.

Shipments of models priced above 3,000 francs continued to outperform, rising 7.8% by value in April and 6.1% by units. However, less expensive watches — with wholesale prices between 500 francs and 3,000 francs — plunged 10% in value.

The report follows better than expected quarterly watch sales from Richemont, the maker of Vacheron Constantin, IWC and Jaeger-LeCoultre watches. The Swiss luxury conglomerate this month reported a 4% drop in quarterly sales at its specialist watchmaker division from the year before.