PARIS — A marked slump in China after a slew of lockdowns crimped growth of Swiss watch exports, but did not stop them from reaching another monthly high.
Growth was “more moderate but still significant,” rising 6.7 percent compared to last year, reach 2.3 billion Swiss francs in October, according to figures released Thursday by the Federation of the Swiss Watch Industry.
For the first 10 months of 2022, the sector has exported the equivalent of 20.4 billion Swiss francs, or $21.59 billion, a 11.9 percent rise over the same period in 2021.
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The fall in China had “a decisive impact on the overall performance,” the organization said, as the latest round of lockdowns in China, in major cities like Shanghai and Guangzhou, weighed heavily on the market and accounted for the 18.1 percent slump in the sector’s second-largest export market. Hong Kong recorded a 5.5 percent decline.
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By contrast, other markets performed strongly, starting with Europe, led by France and Germany rising 28.1 and 27.5 percent respectively.
Other top performers included Australia with a 43.5 percent leap, Singapore at 29 percent and the U.S. at 16.7 percent, while the U.K. and Japan logged single-digit growth.
The breakdown in terms of materials showed that growth in October came from watches in precious metals, growing 11 percent in value and 9.7 percent in volume.
Steel watches, the dominant category accounting for nearly 40 percent of all watches, showed a slight increase in value of 1.5 percent, but fell 17.5 percent in volume. Other materials rose sharply in value by 26.8 percent, while their value rose 10.3 percent.
Total watch exports across all materials saw a 12 percent slump in units and a 6.9 percent increase in value.
According to a Barclay’s research note, the results remained solid, “albeit normalizing after several months of outperformance,” with continued growth across markets like the U.S. seen as a positive for the hard-luxury segment.
High-end timepieces, priced above 3,000 Swiss francs, drove most of the monthly growth, rising 11.4 percent, “as the post-pandemic high-end demand wave continues,” added Bernstein analyst Luca Solca, referring to stellar results by LVMH Moët Hennessy Louis Vuitton and Hermès for the third quarter of 2022 and the Compagnie Financière Richemont’s fiscal first half.
Watches at an intermediate price points, between 500 and 3,000 Swiss francs, contracted slightly in volume, but grew in value 3.1 percent.
Meanwhile, entry-price and mid-market segments declined respectively 26.4 percent and 37.1 percent, as concerns on a global recession mount.