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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
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
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
The choice of a particular watch is most often based on one’s lifestyle, place in the pecking order, discretionary income and personal preference. One can find a watch in the drugstore that tells time just as accurately as a fine Swiss watch with a six-figure price tag. The real difference? Each carries a different message. One’s decision of which watch to wear will tell more than just the time. Watches not only tell time, they also send messages. Not the ubiquitous e-mail or text messages, but personal statements about their owners.So it's important to chooes a watches.
For example, a Rolex reveals a certain class and style, not to mention an appreciation of quality and precision.Just as astute observers draw different conclusions about people from cars they drive— whether they’re luxury models, hybrids, SUVs, or minivans—so, too, do they discern meanings in someone’s choice of a watch.
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The Federation of the Swiss Watchmaking Industry (FHS) recently reported that chronometer certifications--a key measure of mechanical timekeeping accuracy--were up 10.7 percent in 2006. Once again, Rolex had the lion's share of the market with more than 50 percent of the 1.3 million certificates issued. Here's how the top 10 breakdown:
Most ladies' watch bracelets will fit a 7 to 7.5 inch diameter wrist; most men's watch bands will fit an 8 to 8.5 inch diameter wrist. Some dive watches are even more generous, as they are designed for use while wearing a wetsuit.
To make sure you fit within these standards, use a soft tape measure to measure the circumference of your wrist. The tape should be pulled tightly around your wrist. After you have determined your wrist circumference, add 1/4 to 1/2 inch for extra comfort, depending on how lose you like to wear the watch.
COLLAPSE IN EXPORTS
Swiss watchmakers export some 95 percent of production.
Swiss watch exports fell 28 percent in February on the year when adjusted for price swings, while exports for the economy as a whole fell 16 percent. The watch sector was the third hardest hit after the textile and metal industries.
In nominal terms, watch exports were down 22 percent -- the second consecutive monthly drop of this size and the fourth month in a row of declining demand from abroad.
MASS DEMAND FADES
Exports of timepieces costing between 500 and 3,000 Swiss francs almost halved in value terms in February and demand for watches costing between 200 and 500 francs slumped by a third.
Exports of watches costing more than 3,000 Swiss francs fell by some 7 percent.
U.S. MARKET CRUMBLES
European markets performed better than the average, with demand in Italy even growing over 2 percent in February. But exports to the United States, the second-largest market for the Swiss watch industry, almost halved.
Exports to Hong Kong, the biggest market for Swiss watches, fell 4 percent, contrasting with China, down 29 percent and the United Arab Emirates, down 38 percent.
STRONG FRANC
The franc has risen some 10 percent on a trade weighted basis since the start of the financial crisis, putting pressure on all Swiss exporters and Swatch Group has said exchange rate fluctuations are one of its main concerns.
Swatch Group recorded an exchange rate loss of 233 million francs in 2008, its highest since its foundation in 1986.
DISCOUNTING
Many retailers have started to slash prices for watches as they look to get rid of their stock. Some retailers are struggling to stay in business as they scramble to get enough cash.
JOB CUTS
The Swiss watchmaking employers association estimates that around 500 jobs, or 1 percent, have been cut so far.
Ebel , Zenith , Chopard, Maurice Lacroix and Girard Perregaux have all started to cut jobs, while Cartier has introduced shorter working hours at one of its factories.
Until 2008, many companies were facing bottlenecks as they did not have enough qualified watchmakers to keep up with booming demand. Between 2002 and 2008, the number of jobs in the Swiss industry grew by 25 percent to 50,000.