Swiss Watchmakers Hope There’s Still Time for Trade Deal

By Rob Bates | August 04, 2025

After the Trump administration announced it would impose 39% tariffs on all imports from Switzerland, the country’s watchmakers are hoping that its government can cut a deal with the United States before Aug. 7, when the new duties are scheduled to go into effect.

“It’s not doomsday,” Swatch Group CEO Nick Hayek told Reuters. “Of course a settlement can be reached. Why would Donald Trump say tariffs are coming on August 1 and not implement them until the 7th? The door is always open.”

Yet that deadline is just three days away. On Sunday, U.S. trade representative Jamieson Greer said on Face the Nation that the new tariff rates are “pretty much set.”

“We’re seeing truly the contours of the president’s tariff plan right now with these rates,” he added.

The 39% levy on Swiss imports is among the highest tariff rates in the world and exceeds the 31% “reciprocal tariff” Trump announced in April. CNBC reported the rate stemmed from a “disagreeable” phone call between Trump and Swiss president Karin Keller-Sutter.

Even if there were new negotiations, it’s not clear what Switzerland might offer the United States, as it’s already eliminated just about all import duties on industrial products.

“There is no problem with reciprocity between Switzerland and the U.S.,” the Federation of the Swiss Watch Industry (FHS) said in a statement, quoted by the Associated Press. “The tariffs constitute a severe problem for our bilateral relations.”

Rahul Sahgal, CEO of the Swiss-American Chamber of Commerce, told Swiss public radio that the main issue is the United States’ $40 billion trade deficit with Switzerland, which can’t be easily reduced.

“The fact that the U.S. has 340 million people and we have 9 million doesn’t go away,” he said. “Even if every Swiss person drank a bottle of bourbon a day, ate a steak, and bought a Harley-Davidson, the trade deficit would not change significantly.”

Industry marketing strategist Misha Mertsyn predicted the new levies will cause watch companies to raise their prices worldwide.

“The financial impact will primarily be felt by Swiss watch brands and authorized dealers in the U.S.,” he wrote on LinkedIn. “The price increase won’t happen overnight, but it’s coming. Expect a global price hike to balance out the losses and keep profit margins intact….

“The Swiss industry isn’t going to raise prices just in the U.S. market, which makes up about 16% of their total watch exports,” he continued. “What’s more likely is a 3–7% price increase across the globe.”

A spokesperson for Watches of Switzerland tells JCK that the retailer will “continue to work closely with our brand partners to mitigate any potential impact.”

U.S.-based retailers of secondhand timepieces say that while the new duty will be a problem for Swiss watchmakers, it could ultimately benefit the fast-growing pre-owned sector.

“For many American collectors, the 39% tariff instantly turned new releases from Swiss brands into a luxury few can justify,” Joshua Ganjei, CEO of European Watch Company, tells JCK by email. “We have seen a dramatic increase in purchasing volume over the past few months as U.S. buyers shy away from international sellers. Importing and dealing with the headaches of an international purchase is no longer worth it.”

(Photo: Getty Images)