Vacheron Constantin's Egerie watch

PARIS — Offering a snapshot of the trajectory of the watches business in the coronavirus crisis era, Swiss watch exports fell by 21.9 percent in March and a further deterioration is expected in April, the Federation of the Swiss Watch Industry said Tuesday.

Watch exports totaled 1.4 billion Swiss francs, or $1.44 billion, with the federation noting that the marked decline, which was led by steep decreases in Hong Kong and the U.K., down 41.3 percent and 33.9 percent, respectively, was actually less severe than the drop in actual sales in some markets. In Italy, which was strongly affected by COVID-19 in March, the decline came to 57.6 percent.

Volumes of timepiece units exported, meanwhile, were down 43.1 percent, a figure that was more representative of the “real state of the watch market,” according to the federation. 

Bucking the trend, the U.S. and China offered rare, and surprising, bright spots, up 20.9 percent to 226.7 million Swiss francs and up 10.5 percent to 155.9 million Swiss francs, respectively. The performance in the U.S. was buoyed by purchases of pricy watches, worth more than 3,000 Swiss francs, likely in anticipation of shipping difficulties, the federation added. The bounce back in China, after steep declines in February, was likely spurred by improving domestic consumption as the crisis eased there.

While dramatic, the decline in business in Hong Kong was likely less severe than the drop in sell-out there, according to the federation, which noted the re-export markets in the region are likely faring a bit better.

Reflecting trends already observed before the disruption from COVID-19 began weighing on exports, higher priced watches performed better than cheaper timepieces, with the highest category, priced over 3,000 Swiss francs down 12.9 percent in value, while those in the 200 to 500 Swiss franc range fell 54.1 percent.

“By price point, data has been consistent with the past year performance with the lower-end segment underperforming,” noted analysts with Bernstein. 

The spread of COVID-19 has prompted the cancellation of traditional watch trade fairs in Switzerland – Watches and Wonders, formerly known as SIHH, and Baselworld, which had been scheduled to take place back-to-back in April and May. Baselworld has been hit with further tumult, with labels including Rolex, Chanel, Patek Philippe, Zenith, Hublot and Tag Heuer recently revealing they will not take part in next year’s edition.

Watches and Wonders, which is dominated by labels belonging to Compagnie Financière Richemont, including Cartier, Vacheron Constantin and Jaeger-LeCoultre, plans to open an online platform beginning April 25 as a virtual alternative to the fair, with a page for each brand and 10-minute streaming videos.