Swiss watch exports rose by 19.2 percent in 2011, despite the strength of the Swiss franc, and should do even better this year, thanks to continued strong demand led by Asia, the Federation of the Swiss Watch Industry said.
This story first appeared in the February 3, 2012 issue of WWD. Subscribe Today.
Foreign sales of Swiss timepieces totaled 19.3 billion Swiss francs, or $21.8 billion at average exchange rates for the period, in 2011. This followed a 22.1 percent increase in 2010.
“Except for 2010, which followed a major downturn, growth in the last 20 years has never been so strong,” the federation stated.
“In a partially unfavorable context, prospects remain very good for the Swiss watch industry. The appeal of its high-quality products, growth potential on important markets and investments made by watch-making firms to ensure their development offer grounds for confidence in the future. In line with this dynamic, the year 2012 is expected to show significant growth and therefore exceed the already very high level of 2011,” it added.
Hong Kong was the biggest market in value terms, with sales up 28.3 percent in 2011, reflecting the dynamism of its reexports to neighboring countries. China posted a 48.7 percent increase, while the U.S. was up 18.4 percent. Europe lagged behind, with Italy recording a 9.5 percent rise and Spain a 3.4 percent increase.
The Swiss watch industry closed last year on a high note, with exports in December rising 21 percent to 1.9 billion Swiss francs, or $2.04 billion.
Swatch Group, the world’s biggest watchmaker, last month said gross sales rose 21.7 percent at constant exchange rates last year but predicted it would be a “major challenge” to top that performance in 2012.
Compagnie Financière Richemont — parent company to brands including Cartier, Jaeger-LeCoultre and IWC — said its sales rose 24 percent in the three months ended Dec. 31, with revenues at its specialist watchmakers division up 28 percent.
HSBC said in a research note the Swiss export figures were not surprising, in light of the data already published by Swatch Group and Richemont.
“The important question now is how Chinese New Year sell-out (sales to the end consumer) went. Initial feedback so far is that growth rates have been robust but lower than in the 2011 Chinese New Year period, which backs up our scenario of a slowdown rather than a collapse in Greater China in 2012,” it said.