Swiss watch industry with significant decline in 2024

Swiss watch industry with significant decline in 2024

After 2023 produced record export figures for the Swiss watch industry for the third time in a row, a very different picture emerged early in the past year.

The Swiss Watch Industry Association reported declining growth and significant declines in many months of 2024, only rarely interrupted by a “slight recovery.”

The figures for the full year 2024 are now available and show a decline in exports of 2.8 percent compared to 2023 (CHF 26.7 billion) to CHF 25.9 billion. This is still a fantastic result and ranks above the record figures of 2022 (CHF 24.8 billion) and 2021 (CHF 22.3 billion).

Nevertheless, the watch world is taking notice. The reasons for the decline are quite clear, but they cannot be quickly overcome. Moreover, the decline in December of last year was particularly significant, at -5.4 percent to an export value of CHF 2 billion – so a reversal of the trend is not in sight. Instead, the "decline in Swiss watch exports intensified in December," according to the Swiss Association.

This was primarily due to the ongoing slump in demand in China, where slowing economic growth, the real estate market crisis, and youth unemployment have severely impacted luxury goods consumption. This has also partially affected other markets that are heavily geared towards Chinese tourist consumption.

And that won't change in 2025. How the potentially impending tariff war between global economic powers will affect the luxury sector remains to be seen.

Looking at the number of units exported, the picture is almost dramatic, with a decline of 9.4 percent to 15.3 million units in 2024 compared to 2023. This highlights the fact that the business of Swiss watch manufacturers is increasingly shifting toward the high-price segment. The air will become thinner, especially for brands in the mid- and lower price segments.

But even the big players are struggling, as the current business figures of Richemont, LVMH, Swatch Group and Kering show.

Declines in all price segments

Declines were recorded in all price segments in December 2024 compared to the same month last year. Watches with an export price between CHF 200 and 500 recorded the largest decline in value (-13.2 percent). Watches priced below CHF 200 (-5.9 percent) and above CHF 3,000 (-5.3 percent) also suffered significant losses. The CHF 500 to 3,000 segment fared better, recording a decline of only 1.8 percent.

With regard to materials, except for the steel and precious metals categories, significant declines were recorded: -8.5 percent for other materials, -16 percent for gold/steel watches, and -20.9 percent for other metals. Value declined in almost all categories: precious metals (-3.4 percent), steel (-5.9 percent), gold/steel (10.3 percent), and other metals (-6.1 percent). The only exception here was the other materials category, which saw a 9.4 percent drop.

Declines in all four major export markets

The United States (-1 %) recorded a slight year-on-year decline in value in December 2024 for the first time in six months. Hong Kong (-6.4 %) moved up to second place in the global ranking of Swiss watch exports, with a less pronounced decline than in previous months, while China (-19 %) continued to perform very poorly.

Japan (-12.7% yoy) also saw a very significant decline. The country had repeatedly provided an important offset in recent months due to the weak yen, which had attracted many Chinese and other tourists to travel there for shopping.

Among the top 15 markets, only the United Arab Emirates (+0.6 %), the United Kingdom (+5.8 %), Spain (+19.3 %) and Australia (+7.2 %) achieved positive results.

Exports to Germany in December last year were 11 percent lower than in December 2023, while Austria performed even worse by 15.1 percent.

For the whole of 2024, the declines to Germany amounted to 3.8 percent and to Austria to +8.7 percent.

The annual increase in exports to the USA was 5 percent compared to 2023, reaching CHF 4.37 billion. This means that about 20 percent of all Swiss watch exports went to the United States, almost 47 percent went to Asia, and 30 percent to Europe.

Last year, exports to China fell by 25.8 percent and to Hong Kong by 18.7 percent, while exports to Japan increased by 7.8 percent.