• Swiss Watch Exports Face Largest Decline Due to the Apple Watch and an Asian Slump

    Over the past week, Swiss watchmakers woke up to news of another steep decline as October shipments of mechanical watches declined 12% to $2 billion, which is the largest decline in six years.

    The country with the most pronounced drop-off was Hong Kong, whose share of shipments dropped just under 40%. Hong Kong, which is traditionally a huge marketplace for Swiss watches, is seeing declining sales from high-end Swiss manufacturers like Richemont, while others like Tag Heuer has closed stores in the country this year due to weak demand. Swiss Watch sales are said to make up roughly one tenth of the country’s total exports, which have declined 3.2% over the first ten months of this year. The news is followed by similar drop-offs over the course of the year, including an 8.5% drop-off last quarter, which was reported last month.

    Simultaneously, smart watch sales are continuing to accelerate with the Apple Watch sales reaching more than $1.69 billion in revenue through the end of September. The smart watch category as a whole has received a total lift from Apple’s entry into the market, with both Pebble and Fitbit reporting better-than-expected numbers for their respective smartwatch lineups as well.

    The notion of mechanical watch buyers not being drawn to smart watches seems to slowly be changing with some Swiss watch companies now doing a 180 and embracing the idea of smart technology on the wrist. Tag Heuer recently released a “smart” version of its famous Careera watch earlier this month, which is running on Google’s Android Wear platform and retailing for $1,500.

    News of the Swiss watch makers facing a steep decline is likely going to be repetitive unless they turn around and start creating smart watches that are equally as capable as their mechanical counterparts in their respective field. We’ll have to wait and see what happens.

    Source: Bloomberg
    This article was originally published in forum thread: Swiss Watch Exports Face Largest Decline Due to the Apple Watch and an Asian Slump started by Akshay Masand View original post
    Comments 5 Comments
    1. RandyTG's Avatar
      RandyTG -
      Is there any direct evidence to back up the claim that the Apple Watch is the cause behind the decline in the Swiss watch exports? The timing is just coincidental. Mechanical watches and the Apple Watch are like comparing apples and oranges. As as a person that appreciates mechanical watches and a long term iPhone owner; I would still spend $1500+ for a mechanical watch over buying the Apple watch. Are there people out there really buying the Apple Watch just for the time telling function? The slow down in Swiss watch sales has more to do with the Chinese crack down on bribes than anything Apple is selling.

      "...unless they turn around and start creating smart watches that are equally as capable as their mechanical counterparts in their respective field." The answer to the decline in Swiss watch exports IS NOT for them to start competing against the likes of Apple, Samsung, Pebble, Fitbit, etc. For years the Swiss were living off the increase in sales due to an expanding Chinese market, predicated on businesses buying their watches to bribe Chinese officials. Now that market is in decline, so they need to focus on other countries and not enter into competition with technology giants that have a more diverse brand than any single Swiss watch maker does.
    1. brab's Avatar
      brab -
      There isn't, however he pulled the exactly SAME crap earlier this year:
    1. unison999's Avatar
      unison999 -
      I gave away my Apple watch and went back to my swiss made Tag, for simple fact of reliability (do not have to shake my wrist to activate the watch when simple raise do not) and feels great not having to charge it every freaking day. When going away I have to pack my iPhone charger and watch charger and hope I do forget it somewhere which is a hassle to replace.

      But Apple Watch do have an affect on mechanical watch sales no matter how you cut it, someone for sure did not buy a mechanical watch and bought an Apple watch. But this will not be a permanent thing. Seem to recall even James Bond movies went from mechanical Swiss watch to a Casio digital watch because it was popular once, but they all came back to mechanical watch soon after.
    1. jonathan1683's Avatar
      jonathan1683 -
      I have never seen a single person with an apple watch and I have seen 2 with samsung watches.
    1. Lawrence Coleman's Avatar
      Lawrence Coleman -
      Sure. Nobody even talks about the iWatch anymore. Wearables just aren't the category people thought they'd be, because they don't do anything special yet. As the poster above said, correlation does not equal causation.
  • Connect With Us

  • Twitter Box

  • Facebook