PARIS — Swiss watch exports have started the year at the same pace as they finished 2022, increasing 8.6 percent in January to 1.9 billion Swiss francs, or $2.1 billion at current exchange rates, according to the Federation of the Swiss Watch Industry.
With its 26.3 percent growth, marking 24 consecutive months of double-digit increases, the U.S. took a 17.2 percent market share and cemented its position as the largest market for Swiss timepieces with sales of 318.8 million Swiss francs, or $344.4 million, the federation said on Tuesday.
By contrast, China just topped the $200 million mark and slumped 17.3 percent as it is “still in a transitional phase following the lifting of health restrictions,” according to the organization. A positive indicator of things to come may be the return to growth of Hong Kong, which lifted the last of its health requirements in the third quarter of 2022, with a rise of 10.3 percent in January.
In a recent research note on the global luxury goods market, Bernstein analyst Luca Solca pointed out that consumer survey data in China showed “a shift towards pre-COVID-19 levels of luxury consumption” for 2023, with watches “clear winners” alongside bags and jewelry.
Luxury conglomerates including Kering, LVMH Moët Hennessy Louis Vuitton and Hermès, which reported their full-year results in recent weeks, noted signs of recovery in the Chinese market in early 2023.
Elsewhere, while a large number of markets showed high-double-digit growth, more moderate increases were seen in Europe and the U.K., at 12 percent and 5.2 percent respectively.
The global picture pointed to growth “at a normalizing pace after a year of stellar growth,” said Barclays head of European luxury goods research Carole Madjo, noting that “continued growth across key markets such as the U.S. and the U.K. is a positive read-across for the hard luxury space and continues to suggest demand for watches remains solid.”
The breakdown by materials showed that while still the smallest in value, the “other materials” category continued to gun ahead, leaping 49.5 percent in volume with sales doubling to 58.2 million Swiss francs, or $62.9 million.
Precious metal watches were the only other category that also grew in both metrics. Steel watches, accounting for more than half of the market in terms of units, contracted 8.5 percent in volume but grew by 4.6 percent in value terms.
Price-wise, growth gravitated toward the highest and lowest ends of the range. Volume and value of watches priced below 200 Swiss francs “reflected the strong momentum in the other materials category,” noted the group. Watches priced above 3,000 Swiss francs leapt 12.6 percent for the first month of the year.
The mid-market segment between 200 Swiss francs and 500 Swiss francs, on a downward trend since early 2020, continued to contract sharply, and the 500 Swiss francs to 3,000 Swiss francs category also lost 4.7 percent.