GENEVA — At a press convention marking the twentieth anniversary of the Fondation Haute Horlogerie (FHH) in Geneva final week, watchmakers gathered in a present of energy to double down on plans to revitalise an {industry} going through a double-digit decline in gross sales.
Because the pandemic-era luxurious growth delivered three consecutive years of file revenues, the Swiss luxurious watch {industry} has seen demand stoop. In its June report, the Federation of the Swiss Watch Trade (FHS) reported that watch exports of two.1 billion Swiss francs in Could have been down 9.5 % year-on-year, regardless of the effectively documented worth hikes of the previous 12 months. Volumes crashed too, down 13.4 % for the month, equal to 180,000 models.
Whereas exports this 12 months are up 1.1 % general by worth, the FHS report famous that gross sales figures have been unlikely to point out an analogous uptick, with many sellers reporting swollen inventories as manufacturers proceed to use stress on retail networks to decide to orders.
The month-to-month fall was pushed by the US, by far the {industry}’s largest market, which recorded a decline in export values of 25.3 %, a drop that was anticipated following a bumper April throughout which manufacturers and retailers rallied to get forward of President Trump’s incoming commerce tariffs, prompting a freak 150 % surge in exports to the nation.
The image was equally bleak elsewhere. Japan, one of many {industry}’s few vibrant spots over the previous 12 months, recorded a ten.5 % year-on-year fall in Could, whereas exports to the UK dropped 14.5 %. China and Hong Kong continued a sustained interval of market contraction, with export values declining an extra 17.4 % and 12.6 % respectively. Singapore, the sector’s sixth largest market, reported a milder drop of three.4 %.
Pascal Ravessoud, vice-president of the FHH instructed The Enterprise of Vogue ultimately week’s occasion that until the slide was stopped, it posed a long-term risk. “I’m very involved with the lack of volumes and that we promote much less and fewer watches, however increasingly costly,” he mentioned. “That’s not good as a result of sooner or later, you grow to be so small that you just’re not related anymore.”
In accordance with the FHS, over the previous decade, volumes of Swiss watch exports have nearly halved, whereas revenues have risen by round 25 %. Ravessoud referred to as for a rethink: “Watch manufacturers have been too inward-looking and too unique, as a result of issues have been going too effectively,” he mentioned. “Yearly was bringing double-digit development, and now that’s over they need to reinvent themselves. If you happen to don’t reinvent your self once you fail your main utility, then you definately’re going to be useless sooner or later.”
Audemars Piguet chief govt Ilaria Resta agreed. “Our objective needs to be to open our doorways for higher visibility, to demystify a historically closed world, and to protect our traditions whereas embracing innovation,” she mentioned.
Audemars Piguet has been one of many {industry} leaders in immersing its model product in mainstream tradition over the previous decade, with revenues climbing to 2.4 billion Swiss francs final 12 months, in accordance with estimates by Morgan Stanley.
Patrick Pruniaux, chairman and chief govt of Girard-Perregaux, additionally pointed to the relevance problem. “If we have been doing a a lot better job, the {industry} could be 5 instances what it’s as we speak,” he mentioned ultimately week’s occasion. “There could be no query to not purchase our watches on a regular basis. We have to advertise higher.”
The FHH, a non-profit half funded by round 35 watch manufacturers and that operates on an annual finances within the vary of 5 million Swiss francs, is hoping a sequence of contemporary initiatives will assist kick-start the {industry}.
The muse was established 20 years in the past by {industry} veteran Franco Cologni, backed by the Richemont Group (whose watch manufacturers embrace Cartier, IWC and Panerai), Audemars Piguet and Girard-Perregaux. For the previous twenty years, its focus has been industry-facing, providing coaching and schooling programmes in assist of Swiss watchmakers. In Geneva, it mentioned it had to date skilled 40,000 folks and issued greater than 15,000 certificates to watchmaking college students.
However ultimately week’s occasion, the FHH mentioned it will grow to be extra consumer-focused. It opened a free-to-access exhibition referred to as Watch Makers in Geneva that it expects to attract in additional than 12,000 guests over the summer time, and introduced that its FHH Discussion board idea could be held outdoors Switzerland for the primary time when it lands in New York later this 12 months.
It additionally launched FHH Boutique, a web based platform providing paid-for entry to its coaching programmes to members of the general public for the primary time. The course will price 620 Swiss francs and end in a certification Ravessoud mentioned was more and more effectively recognised by {industry} employers all over the world.
Whereas Ravessoud admitted these initiatives have been unlikely to lure again thousands and thousands of misplaced watch patrons in a single day, he mentioned they have been a part of a long-term technique to encourage lovers, significantly girls and Gen Z who he mentioned have been exhibiting a rising curiosity within the class.
Ms. Resta agreed: “New audiences are rising and Gen Z is turning into the following wave of luxurious customers,” she mentioned. “And the affect of girls as patrons and collectors is on the rise, alongside a rising demand for sustainable and accountable enterprise practices. These shifts will not be threats however alternatives.”
Ravessoud mentioned he remained assured the {industry} would overcome its present challenges. “Swiss manufacturers have all the time been resilient,” he mentioned. “When it was wanted, they knew the way to flip round and address the brand new actuality.”
However Cyrille Vigneron, Cartier’s former chief govt and now the Parisian home’s chairman of tradition and philanthropy, mentioned on the occasion that watchmaking needs to be cautious. “We’re past operate and we’re past necessity,” he mentioned. “A watch has grow to be a cultural object of sophistication, but when we expect issues are ceaselessly, they’re by no means ceaselessly. Tradition has to always reinvent, in any other case it may disappear.”
