GENEVA — At a press conference marking the 20th anniversary of the Fondation Haute Horlogerie (FHH) in Geneva last week, watchmakers gathered in a show of strength to double down on plans to revitalise an industry facing a double-digit decline in sales.
Since the pandemic-era luxury boom delivered three consecutive years of record revenues, the Swiss luxury watch industry has seen demand slump. In its June report, the Federation of the Swiss Watch Industry (FHS) reported that watch exports of 2.1 billion Swiss francs in May were down 9.5 percent year-on-year, despite the well documented price hikes of the past 12 months. Volumes crashed too, down 13.4 percent for the month, equivalent to 180,000 units.
While exports this year are up 1.1 percent overall by value, the FHS report noted that sales figures were unlikely to show a similar uptick, with many sellers reporting swollen inventories as brands continue to apply pressure on retail networks to commit to orders.
The monthly fall was driven by the US, by far the industry’s largest market, which recorded a decline in export values of 25.3 percent, a drop that was expected following a bumper April during which brands and retailers rallied to get ahead of President Trump’s incoming trade tariffs, prompting a freak 150 percent surge in exports to the country.
The picture was similarly bleak elsewhere. Japan, one of the industry’s few bright spots over the past year, recorded a 10.5 percent year-on-year fall in May, while exports to the UK dropped 14.5 percent. China and Hong Kong continued a sustained period of market contraction, with export values declining a further 17.4 percent and 12.6 percent respectively. Singapore, the sector’s sixth largest market, reported a milder drop of 3.4 percent.
Pascal Ravessoud, vice-president of the FHH told The Business of Fashion at last week’s event that unless the slide was stopped, it posed a long-term threat. “I’m very concerned with the loss of volumes and that we sell less and less watches, but more and more expensive,” he said. “That’s not good because at some point, you become so small that you’re not relevant anymore.”
According to the FHS, over the past decade, volumes of Swiss watch exports have almost halved, while revenues have risen by around 25 percent. Ravessoud called for a rethink: “Watch brands have been too inward-looking and too exclusive, because things were going too well,” he said. “Every year was bringing double-digit growth, and now that’s over they have to reinvent themselves. If you don’t reinvent yourself when you fail your primary utility, then you’re going to be dead at some point.”
Audemars Piguet chief executive Ilaria Resta agreed. “Our goal should be to open our doors for greater visibility, to demystify a traditionally closed world, and to preserve our traditions while embracing innovation,” she said.
Audemars Piguet has been one of the industry leaders in immersing its brand product in mainstream culture over the past decade, with revenues climbing to 2.4 billion Swiss francs last year, according to estimates by Morgan Stanley.
Patrick Pruniaux, chairman and chief executive of Girard-Perregaux, also pointed to the relevance challenge. “If we were doing a much better job, the industry would be five times what it is today,” he said at last week’s event. “There would be no question not to buy our watches all the time. We need to promote it better.”
The FHH, a non-profit part funded by around 35 watch brands and that operates on an annual budget in the range of 5 million Swiss francs, is hoping a series of fresh initiatives will help kick-start the industry.
The foundation was established 20 years ago by industry veteran Franco Cologni, backed by the Richemont Group (whose watch brands include Cartier, IWC and Panerai), Audemars Piguet and Girard-Perregaux. For the past two decades, its focus has been industry-facing, offering training and education programmes in support of Swiss watchmakers. In Geneva, it said it had so far trained 40,000 people and issued more than 15,000 certificates to watchmaking students.
But at last week’s event, the FHH said it would become more consumer-focused. It opened a free-to-access exhibition called Watch Makers in Geneva that it expects to draw in more than 12,000 visitors over the summer, and announced that its FHH Forum concept would be held outside Switzerland for the first time when it lands in New York later this year.
It also introduced FHH Boutique, an online platform offering paid-for access to its training programmes to members of the public for the first time. The course will cost 620 Swiss francs and result in a certification Ravessoud said was increasingly well recognised by industry employers around the world.
While Ravessoud admitted these initiatives were unlikely to lure back millions of lost watch buyers overnight, he said they were part of a long-term strategy to encourage enthusiasts, particularly women and Gen Z who he said were showing a growing interest in the category.
Ms. Resta agreed: “New audiences are emerging and Gen Z is becoming the next wave of luxury consumers,” she said. “And the influence of women as buyers and collectors is on the rise, alongside a growing demand for sustainable and responsible business practices. These shifts are not threats but opportunities.”
Ravessoud said he remained confident the industry would overcome its current challenges. “Swiss brands have always been resilient,” he said. “When it was needed, they knew how to turn around and cope with the new reality.”
But Cyrille Vigneron, Cartier’s former chief executive and now the Parisian house’s chairman of culture and philanthropy, said at the event that watchmaking should be wary. “We are beyond function and we are beyond necessity,” he said. “A watch has become a cultural object of sophistication, but if we think things are forever, they are never forever. Culture has to constantly reinvent, otherwise it can disappear.”
