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Swiss watch exports head for worst year in decades

Swiss watch exports head for worst year in decades

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Pursuitist Luxury Best Luxury Blog

This is not a surprise. It is time for Rolex to tell the quality and benefit story — instead of just being bling, which has gone out of style.

Swiss watch exports continued to fall at a sharp pace in April, confirming views that prospects for the country’s luxury industry will remain bleak this year. Swiss watch exports totaled 1.05 billion Swiss francs ($960.7 million) in April, down 26% on the year in nominal terms and down 28% in real terms, the Swiss customs office said Thursday. Gold and premium steel watches saw the biggest declines with important destinations such as the U.S. and Japan registering above-average drops. Analysts said Switzerland’s luxury industry – dominated by watchmakers Swatch Group AG (UHR.VX), Compagnie Financiere Richemont S.A. (CFR.VX) and closely-held Rolex S.A. – face a tough 2009. “The decline in emerging markets such as China and Russia is worrying and obviously the US and Japan have basically imploded. But Europe is not that bad – I suspect that is tourists from emerging markets shopping in Europe for watches,” said Kepler analyst Jon Cox. – from WSJ

Swiss watchmakers are facing the worst decline in demand in at least two decades as consumers across the world remained wary about treating themselves to luxury timepieces. Watch exports in April dropped by 26 percent on the year, data from the Swiss Watch Federation showed on Thursday, taking the decline in demand in the first four months of the year to 24 percent. “We forecast a 15 percent decline in Swiss watch exports in 2009 — the worst performance in 25 years,” Citi analyst Thomas Chauvet said. – from Reuters