Slight recovery in watch exports in July
Published: Tuesday, Aug 20th 2024, 09:40
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After the recent setbacks, Swiss watch manufacturers sold slightly more abroad in July. However, exports to Hong Kong and China continue to weaken and overall exports are still below the record level of the previous year.
Swiss watch exports rose by 1.6 percent year-on-year to 2.24 billion Swiss francs in July, the Federation of the Swiss Watch Industry (FH) announced on Tuesday. Over the first seven months, exports totaled 15.2 billion Swiss francs, which is still 2.4 percent below the previous year's figure.
Growth rates in the important markets of Hong Kong (-19.1%) and China (-32.8%) in particular were once again strongly negative in July, while exports to the USA, clearly the largest export market for Swiss watches, increased significantly (+11.3%). The Japanese market saw the strongest growth (+25.6%), securing second place behind the USA in terms of absolute figures.
Precious metal strong
In terms of individual materials, watches made of precious metals were particularly in demand. The increase here was 12.6 percent. In contrast, sales of steel watches fell by 10.4%.
In the price categories, both the segment of watches under CHF 200 and the high price segment with watches over CHF 3,000 (+5.4%) increased by a significant 13.7%. In contrast, the mid-price segment (watches between CHF 200 and CHF 3000) saw a decline of 14.4%.
The trend so far this year has been mixed. Exports fell sharply by 16% in March in particular, whereas exports of "Made in Switzerland" timepieces increased the most in January (+3%) and April (+4.5%).
Analysts rate figures as weak
For analysts, the figures were somewhat weak and, according to UBS, are unlikely to help the already subdued environment for luxury goods after the weak second quarter. The polarizing trend with strong development in low- and high-priced goods and weakness in the mid-price segment is continuing.
The Vontobel expert also believes that high-priced watches continue to have an advantage, which also applies to other products in the sector. Brands such as Rolex should support watch exports, while the mid-range segment in particular has continued its downward trend and the sharp normalization following the post-Covid boom. All in all, 2024 will continue to be characterized by high volatility, adds the ZKB expert. However, a single month should not be overestimated.
The two luxury goods stocks reacted unevenly to the export data. While Richemont just managed to hold its ground in early trading, Swatch fell by 0.6 percent. Analysts are also taking a more negative view of Swatch's export figures.
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