Figures from the Federation of the Swiss Watch Industry (FH) show that exports rose 13.2 per cent in October 2012 to CHF 2.1 billion after September’s first decline in almost three years (CHF 1.7 billion).
October’s increase was led by brands at the top end of the market, with the greatest increases shown in the category of watches priced at more than CHF 7,000, sales of which rose 17.1 per cent. Watches under CHF 200 declined 10.3 per cent, but those priced at CHF 200 – CHF 500 recorded an 18.1 per cent increase, and those between CHF 500 – CHF 3,000 a 6 per cent increase.
Exports to the Chinese market fell 12.3 per cent. China is the third biggest market for Swiss watch exports, behind the U.S. and Hong Kong, the latter to which shipments rose 2.7 per cent. However, the power of the tourist dollar in German and Italian markets, as mentioned last month, continues to be a trend, with Germany and Italy continuing to grow, and the fall in exports to China somewhat offset by the demand from Chinese tourists in Europe.
Despite October’s results, the FH still expects a decline in exports of 5-10 per cent this year.
In related news, a recent survey by Deloittes of fifty Swiss watch executives indicate cautious optimism, with 31 per cent being optimistic about the general industry outlook for the next twelve moths and just over half of those polled of the belief that a strong demand for Swiss watches in China’s second-tier cities and other Asian markets should continue to drive export growth in the next 12 months, as brand which have not yet penetrated these markets expand into them.
Of those surveyed, 49 per cent see the next twelve months as positive, whilst 18 per cent view the next year’s industry outlook as negative. The five biggest challenges and risks are seen as being (in order) weaker foreign demand, the strength of the Swiss Franc, shortage of qualified labour, rising gold price and rising prices for other raw materials.