PARIS — Swiss watch exports decreased slightly in August, dampened by sales of steel products and business in Hong Kong and China.
Exports for the month were down 1.6 percent to 1.47 billion Swiss francs, or $1.52 billion at average exchange for August, according to the Federation of the Swiss Watch Industry.
Cumulative Swiss watch exports since January were in negative territory, with revenues dipping 1.2 percent for the year so far.
The value of exported wrist watches fell 2.4 percent, and in volume terms the business contracted 9.6 percent. Exports were negatively impacted by steel products, while bimetallic watches posted a sharp decline in volume terms. Precious metal watches, however, had a marked improvement in sales.
All the leading price segments recorded steep decreases in August.
Watches costing less than 200 francs, or $207, registered a 7.2 percent drop in the number of units sold, corresponding to a 13.2 percent decline in value terms. Exports of timepieces costing between 200 francs and 500 francs, or $517, were down around 24 percent on both a volume and value basis. Sales of timepieces abroad costing from 500 francs to 3,000 francs, or $3,100, dipped 3.4 percent in value and 6 percent in units. Meanwhile, the higher price segment recorded a 1.7 percent value increase, with volumes remaining stable.
Sales to Hong Kong fell 18.2 percent in August, marking the seventh consecutive month of weakening in the world’s top market for Swiss timepieces. Elsewhere in the Far East, sales to China were down 38.5 percent.
However, the other main markets posted increases. Germany had a 14.3 percent gain and Japan was up 12.9 percent, with sales jumping 11.5 percent both in the United States and France.
Thomas Chauvet, an analyst at Citi, in a research report noted that while the August data showed a return to the year-to-date trend, there was increasingly marked regional growth divergence, especially no improvement in Greater China.
“This is likely to fuel more concerns about the state of the Swiss watch industry which have recently resurfaced following negative China-related news flow in August (poor economic indicators, yuan devaluation and Shanghai stock market correction),” he said. “Despite the anniversary/‘rebasing’ of a significant decline in gifting-related demand in China in 2013 and 2014, we remain concerned about continued disruption in the Swiss watch industry’s largest market, Hong Kong (and its spillover to Macau), renewed China related concerns, recent industry slowdown in the U.S., potential impact of a lower oil price on Russian/Middle Eastern demand and [the Swiss franc’s] strength. It is, however, partly offset by double-digit growth in most European markets (reflecting parallel markets and tourist demand on the weak euro).”