The value of Swiss watch exports began the year 2009 with very marked rates of decline which held steady at between -20% and -33% until October. A recovery was evident in November and December, which months recorded single digit declines.
Signals perceived on the markets indicate that 2010 should see a turnaround for Swiss watch exports. It will however be modest and will only really be felt in the second half of the year, when the annualized variation will return to positive rates.

PRODUCTS

Wristwatches comprised the major part of exports. They saw their value fall by 22.3% compared to 2008, at 12.3 billion francs. Their volume meanwhile fell to 21.7 million units in one year, a decline of 17.0%. As a result, Swiss watch manufacturers exported 4.4 million fewer timepieces in 2009.

All materials registered a downturn. The overall value was affected by gold watches, as well as steel products. Bimetallic timepieces, most often a combination of gold and steel, also had a major negative impact on the annual result. In volume terms, steel watches were responsible for a large part of the overall decline. The category of other metals, mainly aluminium, also fell back sharply. For the category of other materials, the decline was considerably less pronounced.

Wristwatches costing less than 200 francs (export price) saw their value and their volumes decline by 17%, accounting for most of the total fall in volumes. The 200-500 francs segment achieved the best result, even though it remained negative. Here the value fell by 4.7% and the number of units by 3.9%. Watches costing more than 500 francs followed a uniform pattern and recorded the steepest rates of decline. Their value was 23.7% below that of 2008. In parallel, the number of units fell by 25.7%.

Of the other finished products exported by Switzerland in 2009, alarm clocks and clocks in general were among the very few to record growth. The rate of increase here was 6.2%, albeit accounting for a relatively small value in relation to the sector as a whole.
Exports of components recorded a decline. The value of movements leaving Switzerland in 2009 fell by 8.4%. Bracelets (-20.1%), watch cases (-36.0%) and dials (-25.0%) fared no better.

MARKETS

During the year 2009, the fifteen main markets showed the following trend (total value in million francs and % variation by comparison with 2008):
1. Hong Kong / 2,167.9 / -19.7%
2. USA / 1,470.4 / -37.9%
3. France / 968.7 / -14.4%
4. Italy / 900.0 / -13.9%
5. Germany / 794.0 / -13.0%
6. Japan / 768.4 / -33.5%
7. China / 700.4 / -15.2%
8. Singapore / 673.9 / -13.9%
9. United Kingdom / 544.5 / -15.1%
10. United Arab Emirates / 438.0 / -34.9%
11. Spain / 318.9 / -29.5%
12. Taiwan / 244.2 / -15.7%
13. South Korea / 223.0 / +35.7%
14. Saudi Arabia / 190.9 / -20.2%
15. Thailand / 161.7 / -39.0%

Despite some changes at the end of the year and in particular several markets that did register growth, the main outlets in 2009 saw no significant changes to their situation compared to the first half-year. Recording a less pronounced decline than the United States, Hong Kong confirmed its position as the leading destination for Swiss watch exports, thanks in particular to a very good result in December.

Starting from a much lower base, the United States also benefited from a recovery at the end of the year, albeit less marked. This market finally recorded one of the steepest declines of 2009.

The main European markets experienced a slight delay factor and therefore ended the year with slightly less acute downturns. The downward trend recorded by Japan accentuated as the months went by and reached very low levels. While recording an annual result close to that of France and its neighbours, China proved a more attractive proposition for Swiss watch manufacturers.

It is in fact one of the rare markets, with Singapore, to have recorded a second half-year of growth. The Middle East was divided between the mixed performance of Saudi Arabia and the consistently low level of the United Arab Emirates, such that no clear trend is yet apparent. Finally mention should be made of the excellent result achieved by South Korea, a destination for watch exports that continued to show very strong growth in 2009.

Source: www.swisstime.ch

© SIHH

The Fondation de la Haute Horlogerie and the Federation of the Swiss Watch Industry has unveiled its anti-counterfeiting campaign at the Salon International de la Haute Horlogerie 2009:

The Fondation de la Haute Horlogerie and the Federation of the Swiss Watch Industry are joining forces to launch an international anti-counterfeiting campaign. Their objective is to inform the public on the damage caused by this global scourge.

In spite of the many efforts made, the problem of counterfeiting and piracy continues to wreak havoc on virtually every economy worldwide, and is expanding rapidly through multiple distribution channels, especially online.

Astronomical amounts
Calculations based on Customs seizures show that counterfeits and piracy worldwide amount to US$ 200 billion to 360 billion a year, or 5% to 7% of international trade. Swiss watches are no exception, as the sector is hit full-on by this modern-day plague.

The Federation of the Swiss Watch Industry (FHS) estimates that over 40 million fake Swiss watches are made each year (compared with exports of almost 26 million authentic Swiss watches in 2007) and that they generate net profits of around one billion dollars. This illicit trade, whose main victims are the most prestigious Swiss brands, is equivalent to around 6% of total Swiss watch exports for 2007.

Everyone suffers
In this context, it would be naïve to imagine that counterfeiting can be defeated simply by targeting the counterfeiters and their means of production. This wouldn’t be such a thriving industry without the individuals who buy fake watches, and who fail to realise the full extent of the damage they cause, in particular in human terms. The priority in the fight against counterfeiting must therefore be to speak directly to these potential customers and have them realise that what they believe is a harmless purchase has serious consequences on companies and nations. Legislative weapons and international measures still lack the impact to defeat this global scourge; hence the customers themselves must realise that wearing a fake luxury watch is empty of meaning.

Counterfeiters increasingly target internationally renowned Fine Watch brands, whose reputation, capacity for innovation and sales all suffer as a result. These brands must also invest significant amounts in the fight against illicit copies in all their forms and to protect their intellectual property. As counterfeiting continues to spread, an even more serious consequence is the generalised loss of confidence in companies that nevertheless create jobs and added value. At national level, counterfeiting forces governments to invest heavily in the fight against fakes while losing out on tax revenues, and takes away employment opportunities. Finally, the phenomenal amounts of money generated by counterfeiting go on to benefit the mafias, criminal organisations and terrorist groups that reign over this illicit trade, where child labour is commonplace, and health and safety standards are openly flouted.

A powerful message
Faced with a scourge that undermines companies and countries alike, the Fondation de la Haute Horlogerie (FHH) has joined forces with the Federation of the Swiss Watch Industry (FH) to launch a vast information campaign aimed at the general public. It will take the form of powerful visuals backed by a simple, hard-hitting message: “Fake Watches are for Fake People.” The campaign will be unrolled in the international media that are supporting this initiative. Clearly, the Fondation de la Haute Horlogerie, whose vocation is to defend and promote the values of Fine Watchmaking and its professions, could not stay silent in the face of counterfeiting. The time has come to challenge this plague on innovative, socially-responsible, high-tech businesses. We can no longer stand by and do
nothing, so let’s say it out loud:

« FAKE WATCHES ARE FOR FAKE PEOPLE ! »