Swiss Watch Exports Regain Momentum as Chinese Demand Grows

  • Shipments to Hong Kong continue upward trend as U.K. rallies
  • 2017 forecast ‘one of prudent optimism,’ industry group says

Swiss watches sit on display inside a Unique Timepieces store, in Hong Kong.

Photographer: Billy H.C. Kwok/Bloomberg

Swiss watch exports gained for a third time in four months as Chinese demand strengthened and the U.K. attracted buyers with its weak currency.

Shipments climbed 5.3 percent to 1.7 billion francs ($1.8 billion) in June, the Federation of the Swiss Watch Industry said in a statement Thursday that underpinned signs of a rebound from the longest slump on record. Exports to China increased 12 percent. Hong Kong, the industry’s biggest market, rose 4.6 percent for the second consecutive month of gains.

“The situation remains fragile locally,” the federation said in a statement. “The U.S. did not participate in the recovery and some European or Asian markets are still undergoing significant readjustments. The forecast for 2017 therefore remains one of prudent optimism.”
Among other highlights:

  • Exports to the U.S. slipped 1.3 percent in June, bringing first-half shipments down 5.9 percent; federation says situation in that market hasn’t improved in more than 12 months, with no signs of improvement in the near future
  • Shipments to the U.K. jumped 36 percent, the biggest gain in more than two years, as sales are boosted by the weak pound
  • All price points increased in value, except category below 200 francs. High-end watches have outperformed in the first half, boding well for Swatch and Richemont, MainFirst Bank’s John Guy said
  • Excluding calendar effects, exports were up 10 percent in June, Citigroup Global Markets analyst Thomas Chauvet estimates, adding that the federation’s data are distorted because they don’t subtract inventory bought back by Richemont
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