The FHS, the Federation Horlogère Suisse (or the Swiss Watch Federation), has just released export statistics for 2020 marking a year of profound global change. Although the full impact of the coronavirus outbreak cannot be calculated accurately, the pandemic has had a strong impact on the watch industry. Exports dropped by 21.8% in value to CHF 17 billion, below their 2011 level. It is the sharpest decline since 2009 (-22.3%). If the comparison basis will be much lower and some recovery is probably in sight, the outlook remains uncertain for 2021.
The luxury industry has taken a big hit during the pandemic. The FHS has just released its exports statistics for 2020, and as expected, the Swiss watch industry shipments fell sharply at CHF 17 billion (- 21.8%) while the number of wristwatches exported dropped to 5,480,878 units (-33%). Following the collapse seen at the beginning of the year, the industry has seen a gradual slowdown of the decline. Over the last quarter, exports were only down 4.3% – and specifically, down 2.5% in December.
Accelerated shift to local purchasing
This gradual stabilization of the situation has mostly to be credited to sales in China, with shipments up 20% at CHF 2,394 million. China has been the first major economy to recover from COVID-19. Since the pandemic has stopped international travel, Chinese consumers have spent a growing proportion of their luxury budget on their domestic market. This has long been encouraged by government policies and the pandemic is accelerating this reshoring of luxury consumption on a local basis. Mainland China has become in 2020 the number one destination for Swiss watch exports.
On the contrary, in addition to the lockdowns, markets such Hong Kong (CHF 1,696 million; -36.9 %), Singapore (CHF 933 million; -26.4%) or some European countries such as France (CHF 667 million; -37.9%) or Italy (CHF 647 million; -33.3%) have borne the brunt of the collapse in global tourism. Exports to the USA were down 17.5% at CHF 1,986 million.
For more information about Swiss watch exports, please visit www.fhs.swiss.