Swiss watch exports plummeted this month, the largest after 7 years. Demand leveraged in every major market for Rolex and Omega timepieces, the decay in the market was 16.4 percent after October.
The lowest in almost two decades spells a bitter ending for the Swiss watch industry. The threat is greater for employees as companies’ such as Richemont plans on firing a total of 200 positions.
It isn’t the best year for Swiss watches, a total of 11 percent of 10 months in October. U .S. exports declined a total of 17 percent while exports from Hong Kong, the largest and biggest market of Swiss watches, fall to a staggering 22 percent of what was once a 40 percent last September. However, U.K. posted a drive of 9 percent as pound grows weaker resulting to escalations on sales.
The world’s biggest watchmaker, Swatch, dropped 3.5 percent today at 10:14 am GMT in Zurich. Richemont on the other hand, a company that specializes in jewelry and luxurious watches, also experienced the drop by 2 percent. They share the other 13 of 15 markets that experienced the plunge in terms of sales.
The exports of precious timepieces downed at 16.4 percent, the largest fall after the consistent drop after 10 months. China’s government ordeal of preventing anti-graft measures also affect the fall, as the luxurious watches have fallen out of taste for the Chinese shoppers.
Richemont’s inventory closes at 5.39 billion euros or $5.73 billion at the end of September. While Swatch’s inventory closes at 6.26 billion Swiss francs or $6.23 billion by the end of June.
The Swiss watch industry is on the brinks even after sales trends in a fixed-cost environment in particular ahead of the festive season and continued disruption in Hong Kong, the largest and profitable market for Swiss watches. Analyst Thomas Chauvet noted while analyst Patrik Swendimann said that the strong decline took everyone by surprise and that watchmakers voluntarily exported less to subdue the building up of more stocks at retailers. Also on recent reports, the weaker-than-expected October reports export performance places expectations of growth by year-end increased pressure.
“A recovery had been expected in the fourth quarter, but watch industry exports, in fact, reported their steepest fall of the year in October,” the Federation of the Swiss Watch Industry (FH) said.
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