The Swiss watch industry exported $6.2 billion of watches and watch products in 2001, a 3.5% increase and a new record, says its annual report. There were significant gains for precious metal and upscale timepieces. Cheaper watches saw big sales drops.
The value of finished Swiss watches alone rose 3.7% ($5.6 billion), but their volume dropped 11.6% (by 3.5 million) to 26.4 million.
The United States, the largest market for Swiss watches, had the biggest declines – down 14.1% in value (to $932.8 million) and down 16.6% in volume (almost 3.3 million). While the Sept. 11 tragedy had an impact, sales to the U.S. market were already affected by the slowing economy and “falling since March,” says Jean-Daniel Pasche, director of the Federation of the Swiss Watch Industry. However, he told JCK, “We remain confident in this market’s future” and expect a rebound late in 2002.
Precious gains. The report spotlights the ongoing concentration of exports in upmarket products. The greatest growth (mainly in the United States, Asia and Europe) was in gold watches (+15.2%, to 570,457 units) and platinum watches (+64%, to 11,799). While steel watches are the largest category (four out of 10 exports), their volume dropped 7.5% (11,208,143), though their value remained stable ($2.3 billion).
The average price of exported Swiss watches rose to $214.78, a 17.4% gain. Also, while the number of exported movements dropped almost 14% (to 5,390,450), their value rose 2.8% ($76.1 million).
Cheaper Swiss watches saw the biggest sales drops. Aluminum ones, for example, accounted for one in six exported watches, down from one in five in 2000. They also dropped 23.3% in value. Watches of “other non-precious metals” (primarily aluminum and copper) exported 4,317,259 units, worth $188 million. Those of “other materials” (i.e., synthetics, plastics, wood) exported 8,622,661 units, worth $351.5 million.
Economics. The Swiss watch industry was affected a worldwide economic slump affecting jewelry and watchmakers in 2001, especially after Sept. 11. “The downward trend gathered pace in the closing months [of 2001],” says its report. Pasche expects that to reverse this year, as the industry feels the effects of recovery in major economies, including the United States. The first half of 2002 will “likely remain difficult,” he says, but “watch exports should recover towards the end of the year.”
Among Switzerland’s other major markets, Hong Kong took first place for the last two months of 2001, and had a 6% gain for 2001. Japan, despite a sluggish economy, rose 13.3%. Growth overall in the Asian continent is “highly satisfactory,” says the report, with an increase of 24.5 % since 1999. Europe has been less affected by the economic downturn, and saw “significant growth” in Swiss watches in the Germany (+9.4%), France (+10.3%) and Great Britain (+18.7%) in 2001.