The 2023 Swiss Watch Industry In Review

A Year of Record-Breaking Performance

The Swiss watch industry’s performance in 2023 has been nothing short of impressive. According to the Deloitte Swiss Watch Industry Study, watch exports reached an all-time high of nearly CHF 25 billion, representing a significant increase from the previous year. This growth trajectory continued in the first eight months of the year, with watch exports expanding by 10.2% in volume and 9.2% in value. Despite inflation and a strong Swiss franc, the industry has managed to maintain its upward momentum, indicating robust demand and market resilience.

Key Export Markets

The United States and China, two core regions for the Swiss watch industry, have played a key role in driving export growth. The US remains the most important single country market, with exports reaching almost CHF 2.7 billion in 2023, an increase of 10% compared to the previous year. China, now the second most important market for Swiss watchmakers after the US, is experiencing a resurgence in watch sales. The Chinese government’s departure from its Zero Covid policy has led to a spending spree, fueled by savings accumulated during the lockdown. China accounted for 11.3% of Swiss watch exports, followed by Hong Kong as the third largest export market with a share of 9.5%.

India: The Emerging Powerhouse

One of the most significant developments in the Swiss watch industry is the growing recognition of India as a market with immense potential. The Deloitte study revealed that industry executives overwhelmingly identified India as the next major growth market for Swiss watches. In the first eight months of 2023, India witnessed a substantial increase in watch exports, with a value of CHF 133.7 million, representing an 18.5% rise compared to the same period last year and a nearly 60% increase over 2021. The young and affluent population, coupled with India’s robust economic growth, positions the country as a key player in the future of the industry.

The Shift towards Sustainability

Sustainability has become a key priority for the Swiss watch industry. The Deloitte study highlights a significant shift in motivation, with sustainability moving from a consumer-driven demand to an industry-led mission. More than two-thirds of respondents indicated that sustainability is now part of their corporate strategy, with investments being made in areas such as circularity and governance structures. Certified ethical gold, recycled materials and leather alternatives are expected to play a key role in the industry’s sustainability efforts in the coming years.

Watch brands are investing in sustainable production methods and integrating sustainability into their corporate strategies. For example, ID Genève, a watch brand focused on environmental orientation, produces watches using ethically sourced and recycled materials. Their latest collection, Circular S, features watches made from 100% recycled steel and straps made from plant-based materials.

Purchasing Decisions

Understanding market trends and consumer preferences is essential for the continued success of the Swiss watch industry. When buying a luxury watch, consumers consider several factors. According to the Deloitte study, brand reputation, design, and price-performance ratio are of decisive importance to most consumers. The longevity of the watch and its sustainable production methods have also emerged as significant considerations, particularly for buyers from France and Germany. Environmental compatibility and sustainability have become essential criteria for consumers, reflecting a growing societal focus on responsible consumption.

The Rise of Independent Watchmakers

In recent years, independent watchmakers have gained prominence in the Swiss watch industry. These innovative brands combine traditional craftsmanship with contemporary design, appealing to collectors seeking unique and handcrafted timepieces. Independent watchmakers often prioritise artisanal and labour-intensive processes, resulting in watches that blend classic details with modern aesthetics.

The personal touch and individuality offered by independent brands have resonated with consumers, contributing to their growing popularity. Notable independent watchmakers include Akrivia CEO Rexhep Rexhepi and Norqain CEO Ben Küffer. These personalities have redefined traditional watchmaking by infusing it with modern technology and design. Their individuality and artisanal approach have garnered attention from watch enthusiasts and collectors.

Challenges of the Industry

A shortage of qualified workers poses a significant challenge for the Swiss watch industry. As the industry continues to expand, finding skilled personnel becomes crucial for its long-term viability. The Employers’ Association of the Swiss Watch Industry has emphasised the need to recruit and train 4,000 specialists by 2026 to secure the industry’s future. The watchmaking profession requires years of apprenticeship and specialised knowledge. Efforts like the Watch Academy in Geneva, founded by personnel service provider Adecco Switzerland, aim to make the profession more attractive to young people.