Under economic crisis's swiss watches manufacturing industry

Demand for Swiss watches are expected to drop in 2009, especially among the smaller, less well know demands, said Jean-Daniel Pasche, who heads the Federation of the Swiss Watch Industry (FHS).
“This year will not be better than 2008,” Pasche told Bloomberg in a recent interview. “For smaller newcomers we could expect some trouble for some of them. We are rather confident for the strong brands.”
The financial crisis is thought to be largely responsible for the recent decline in watch purchases, which make up about 10 percent of Switzerland's total exports.

It seemed just a few short weeks ago that you couldn't turn anywhere without finding a story about the renaissance of the Swiss watch industry. But the economic crisis means luxury items are just that in a time of restrained spending. That's got the attention of some analysts who say 2009 is shaping up to the be the worst year for watch sales in decades. For example, the National Post recently reported:

The slowdown in demand for new expensive watches is causing a panic in Switzerland, where 2009 is threatening to be the worst year for the Swiss industry since the "quartz crisis" of the 1970s and 1980s, which made mechanical watches technologically obsolete and reduced industry employment to 30,000 from 90,000.

What do you think? On target or hyperbole? Have you shelved that plan to buy a new Swiss watch?

The Swiss Watch Boutique reported recently that as the financial crisis continues to play out in uncertain ways, the Swiss watchmaking industry is bracing for its first significant slowdown in many years. The wealthy bankers who scooped up Swiss watches, like Omega, Rolex, and IWC may not be in a position to sustain the watch business. Already this year, shares in Swatch Group, the world’s largest watchmaker, have plunged nearly 40 percent.

But unlike the 1970s and 1980s, experts predict single digit growth for the industry rather than outright retraction. Strong demand in emerging markets, such as India, Russia, and China, are expected to help soften the impact of the worst global financial mess since the Great Depression.