US Market, Former Driver of Record Sales Surge During Pandemic, Records 4.9% Drop in April Exports
The Federation of the Swiss Watch Industry announced on Thursday that monthly Swiss watch exports to the US experienced a decline for the first time in more than two years, reflecting a slowdown in demand from the largest market for luxury timepieces.
In April, exports to the US fell by 4.9%, marking the first decline since January 2021. The US had played a pivotal role in driving a remarkable surge in sales during the pandemic.
Last year, the US surpassed China to become the leading market for Swiss watches.
Renowned watchmakers such as Patek Philippe, Oris, and Zenith recently acknowledged a softening in demand for their products in interviews with Bloomberg News.
Despite the decline in the US market, overall Swiss watch exports showed resilience, increasing by 6.8% in value during April. In the first four months of the year, exports rose by approximately 10.5%.
As China emerged from Covid-related lockdowns, exports to the country more than doubled in April. Similarly, sales to Hong Kong increased by almost 16%, while exports to the UK, another significant market, grew by nearly 10%.
Analysts at Morgan Stanley, led by Edouard Aubin, noted that although Europe’s market remained steady, the rebound in China was not substantial enough to offset the US slowdown and return to normal trends. The analysts stated in a report that based on trends over the last three months, the industry could potentially experience a year-over-year contraction in May.
Despite economic challenges, global demand for Swiss luxury timepieces reached a record high of over 24 billion francs ($26.4 billion) in 2022 and has continued to remain relatively robust.
In April, the export volume of timepieces also saw an 18.8% increase compared to the same period last year, driven primarily by watches priced below 200 francs. The enduring popularity of the Omega MoonSwatch collaboration by Swatch Group AG resulted in a 35% surge in exports of watches priced below 200 francs in April.