Revue FH - 30 August 2012
Philippe Pegoraro
The total value of exports by Swiss watch manufacturers amounted to 10.1 billion francs in six months. The ten billion franc mark has therefore been exceeded before the middle of the year, which is a first. This result represents an increase of 16.4% compared to 2011. The first six months all recorded a steady growth. Only April (+8.5%) failed to show a two-digit rate of variation due to a very unfavourable base effect. June produced the best performance with an upturn of 21.7%.
The sector continues to have the wind in its sails, despite a high base of comparison and a difficult economic environment. The European situation and news of a slowdown in China appear to be having no effect on watch exports buoyed by growing demand, particularly in the luxury segment. As a consequence the trend has outpaced the final annual target, which forecast growth but at a level only half as high as that of 2011.
Wristwatches accounted for the major part of watch and clock exports. Their total value was 9.5 billion francs, 16.9% higher than January-June 2011. The number of timepieces remained close to the previous level at 14.1 million units (+1.4%).
Timepieces manufactured from precious metals recorded the highest increases. Gold in particular made a strong showing, bringing it on a par with steel in terms of export value even though the number of pieces is not comparable. While the total increase in volumes was modest, most materials played a contributing role.
Growth was driven by the segment of watches costing more than 3,000 francs (export price). Here, value rose by 25.4% compared to 2011. Timepieces costing less than 200 francs recorded a decline in the number of pieces (-1.9%), offset by the upturn in the 200-500 franc category (+11.0%). Watches between 500 and 3,000 francs recorded a more modest increase (+3.4% by value and +4.7% by volume).
Other products exported by the Swiss watch industry totalled 615.8 million francs (+9.4%). In this category, supplies as a whole recorded a downturn (-16.2%), while exports of movements were up 11.5% in value terms. Alarm clocks and other clocks accounted for a low value of 19.0 million francs, comparable to last year (-1.5%).
In the first half of 2012, the fifteen main markets showed the following trend (total value in million francs and % variation by comparison with the first half of 2011):
1. Hong Kong 2'175,4 25,7%
2. USA 1'073,7 +10,3%
3. China 833,8 +16.2%
4. France 614,8 -1,7%
5. Singapore 539,3 +6,7%
6. Germany 536,1 +35,7%
7. Italy 535,7 +8,6%
8. Japan 504,4 +31,3%
9. United Arab Emirates 404,1 +13,0%
10. United Kingdon 336,9 +16,9%
11. Taiwan 226,9 +34,2%
12. South Korea 225,0 +29,8%
13. Spain 167,9 -0,2%
14. Saudi Arabia 160,4 +18,1%
15. Thailand 134,9 +4,7%
Not all regions of the world showed the same vigour during the first halfyear however growth was evident on most of the Swiss watch industry's main markets. Thanks to a marked upturn, with the world average. The situation in Europe improved sharply at the end of the period, thanks in particular to a strong showing by Germany. However the picture was mixed in terms of results on the main markets. France lost ground slightly, Germany was one of the most dynamic markets, and Italy recorded a more modest, albeit significant increase. The United Kingdom remained on a positive trend, while Spain maintained its 2011 level. In Asia, all markets recorded positive results. Singapore and Thailand showed a single-digit rate of variation. The pace was faster in Japan, Taiwan and South Korea. The Middle East for its part was situated close to the world average.
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Within a whisker of two billion
The value of Swiss watch exports almost attained two billion francs in July. Strong growth (+15.4%) resulted in a particularly high level for this period of the year. The sector therefore shows no obvious sign of losing its momentum in terms of exports, despite what was expected. This trend will be monitored closely at a time when some market segments have already registered a slowdown.
Gold watches generated the highest value, buoyed by a sharp increase compared to July 2011. Steel timepieces also contributed to the rise in export sales. The total number of timepieces fell by 3.8%, while remaining at a high level. The category of other metals (mainly aluminium) recorded a significant decline which weighed on the overall result.
The downturn in volumes was concentrated in the segment of watches costing less than 200 francs (export price) which recorded a result of -8.3%. This decline was partially offset by other categories. Timepieces priced at between 200 and 3,000 francs saw their value increase by 4.6%. As in previous months, growth in value was concentrated in the segment of watches costing more than 3,000 francs, where the monthly increase was 24.1%.
The geographical distribution of exports reflected sales data from the markets. Hong Kong recorded another slight slowdown in growth with a zero variation in July. The United States maintained its position, although sales here were quieter. In fourth position, China recorded a second month of decline, slowing its pace further. Europe overall followed a contrasting path, with strong increases on its main markets.
