Swiss Watch Exports Fall Again on Waning China Demand

Watches by Swiss watchmaker Rolex are displayed at the 42nd edition of the Baselworld watch fair on March 26, 2014, in Basel. Fabrice Coffrini / AFP via Getty Images

Exports of Swiss watches declined for a second straight month in October, driven in part by a drop in demand in China as consumers pulled back on luxury spending, according to a statement from the Federation of the Swiss Watch Industry.

Swiss timepiece exports declined 2.8 percent to around 2.3 billion Swiss francs ($2.6 billion) in value, 2.2 percent lower than in October 2023 and close to the trend seen since the start of the year, the federation said.

Exports to China were down roughly 39 percent in October, according to the federation, while imports to Hong Kong also fell 14.8 percent. The somewhat subdued sales in those two key markets represented a “major obstacle at the global level,” according to the federation.

The declines in China and Hong Kong were also in sharp contrast to the steady upward trend in shipments seen in the United States and Japan; exports to those nations were up 11.3 percent and 20.4 percent, respectively.

Elsewhere, exports to Europe remained steady, predominantly due to demand in the UK and Spain, which the federation said made up for declines to Germany, France, and Italy.

The federation said overall exports declined by 2.6 percent in the first 10 months compared with the same period a year ago.

Watches with an export price of less than 500 francs ($565) saw their export value diminish by 9.4 percent compared with October 2023, while watches priced between 500 and 3,000 francs ($565-$3,392) saw the sharpest declines, at 21 percent, according to the federation.

Conversely, higher-priced watches over 3,000 francs rose slightly, by 1.7 percent.

It marks the second month in a row where exports of Swiss wristwatches dropped after the federation reported a sharp decline of 12. 4 percent in September, for a total value of 2.1 billion francs ($2.37 billion).

China’s Economy Still Struggling

That decline, which followed what the federation described as a “brief reprieve” during the summer, was again driven by declines in exports to China and Hong Kong, which accounted for two-thirds of the reductions.

The latest figures come as the designer watch industry—including brands such as Rolex and Patek Philippe—continues to struggle amid a volatile economic environment and high inflation that has seen consumers drastically cut back on spending following a brief revival post pandemic.

Amid the slump, some brands have scaled back production and temporarily discharged workers in efforts to cut costs, according to reports.

The latest drop in exports also comes as China’s economy appears to still be struggling with rising local government debt and a downturn in the real estate market, among other issues, despite the ruling Chinese Communist Party implementing a series of stimulus measures.

Data published by the People’s Bank of China in October showed China’s banks issued 500 billion yuan (roughly $69 billion) in new yuan loans in October, marking a 69 percent drop from September’s 1.59 trillion yuan (about $220 billion) and coming in at around 200 billion yuan (about $28 billion) lower than expected.

Meanwhile, outstanding total social financing—a broad measure of credit and liquidity in the economy—slowed to a record low of 7.8 percent in October, down from 8 percent in September.

Elsewhere, foreign currency-denominated loans in October dropped by 21.9 percent year on year, with growth remaining negative for the past 28 months.

Market analysts say the latest financial figures from China suggest the country’s economic slowdown may continue into 2025.

Alex Wu contributed to this report.