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Swiss Watch Exports Boomed in Q1 2023 Despite Post-Covid Market Fears

Despite fears that the hype around Swiss watches would fade after Covid, Q1 of 2023 has been a boom for exports thanks to a growing Asian market....

Despite concerns that in a post-Covid world the hype for Swiss made watches would die down, but that hasn’t been the case. A recent report from the Federation of the Swiss Watch Industry has shown that Swiss watch exports have done great numbers in the first quarter of 2023. 

In March alone Swiss watch exports increased 13.8% with 1.5 million timepieces exported, a rise of almost 24% compared to the same period last year. In comparison to February, an additional 300,000 units were exported in March, an uptick of 6.2%.

The whole quarter saw an increase of exports by 11.8%. Largely this increase in exports has been due to watches priced under 200 CHF.

There were large levels of growth in the Asian market particularly in South Korea, Saudi Arabia, Taiwan, and Qatar which all saw high single or double digit growth. Hong Kong was the second largest growing market in March, increasing by 61.9%.

Other markets that saw significant growth for Swiss watches were Singapore at 19% and Japan saw a 1.5% increase.

This is a significant increase throughout, so much so that RBC analyst, Piral Dadhania, said that March’s results “confirms ongoing momentum in the Swiss watch industry, albeit with changing growth contributions towards key Asian markets, with ongoing U.S normalisation.”

In addition, LVMH saw an 11% growth in watch and jewellery sales and have even become the first European company to achieve a valuation of over $750 billion USD.

According to Bloomberg, the luxury sector is experiencing a period of unprecedented success largely attributed to China’s reopening after pandemic lockdowns. Hermès has also experienced large areas of growth reaching $326 billion AUD in value. 

“Luxury stocks embody what the equity market has best to offer at the moment: exposure to Chinese consumption, which continues to surprise on the rise, and robust margins thanks to their pricing power,” said Lilia Paytavin, European portfolio strategist at Goldman Sachs Paris. 

“This differentiates Luxury from Tech, whose margins have been contracting for several quarters already.” 

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