Swiss watch industry sees record growth first time after 2014: How the biggest markets for luxury watches performed

Swiss watch industry seems to be getting its mojo back, though still a long way to go from the heydays of 2012-2014. According to the Federation of the Swiss Watch Industry (FH), exports grew by 8.3% compared in July 2021, to 2.2 billion francs, the highest monthly number since the record performance of October 2014. Overall, Swiss watches saw global demand improve during the first half of this year. There was an increase of watch exports to most markets with the notable exception of China and Hong Kong. The downturn in macroeconomic, geopolitical and health conditions has by and large only had a limited impact on the sector’s results in the first six months of the year 2022, as per FH. Notwithstanding this strong growth, the industry is at an all-time low, attaining less than half of the figures recorded ten years ago.
The top Swiss watchmakers include Rolex, Omega, Audemars Piguet, Breitling, Tag Heuer and Patek Philippe. The industry has seen its fortunes go down ever since Apple entered the watch industry with its smartwatch Apple Watch in 2015. In 2018, Apple for the first time beat Swiss company Swatch to emerge as the world’s largest watchmaker.
What led the growth of Swiss watches
Swiss watch exports between January and June 2022 amounted to 11.9 billion francs, representing a growth of 11.9% compared with the first semester in 2021. While 70% of this increase stems from mechanical watches made of precious metals (Gold and Silver) or steel, the other categories also contributed to the overall upward trend.
Growth coming from sales of high-end watches
Watches priced at over 3,000 francs export price (Rs 2.5 lakh) accounted for most of the growth in terms of value (+15.5%). The 500-3,000 francs category (+6.0%) also contributed to this growth, while the 200-500 francs category (-19.1%) suffered a sharp drop. This category experienced a comparative decline in volume (-16.8%) vis-a-vis the trends of all the other categories, which saw a significant increase in their number of parts.
How the biggest markets for luxury watches performed
The United States (+31.4%) lead the market. The growth in the US market remained strong and it alone absorbed nearly 16% of Swiss watch exports. The US market benefited from additional deliveries as a result of the difficulties affecting distribution in China.
In Asia, the Chinese market (-26.3%, of which -43.3% in the second quarter) was significantly disrupted by the anti-Covid measures in April and May. However, with 1.1 billion francs in six months, China lies significantly above its pre-pandemic results (+19.3%). Hong Kong (-11.5%) was also down, showing no real change from previous years. All other Asian markets — including the three biggest UAE, Singapore and Japan — achieved significant growth.
Markets in Europe showed an even more marked upturn, for example: the United Kingdom (+31.8%), Germany (+25.4%) and France (+36.5%). The only exception was Russia (-64.3% in the first half of the year and -98.3% since the start of the conflict).