Switzerland’s watch exports declines amid growing competition from smart watches, including the most popular model, the Apple Watch, which is only 3 months of sales was realized in the amount of 3 million copies.
For the first time in the last 6 years the export of Swiss watches has decreased, according to “Vedomosti”, citing data from the Federal customs office of Switzerland. In December 2015, with a decline of Swiss exports in real terms compared with November fell by 3.8%, and the total fall for the year was 3.3%. The total market now stands at 21.5 billion Swiss francs ($ 21.2 billion).
A year ago exporters hours noted growth of 1.9%. Exports decreased hours throughout 2015, Assessing the situation, the Swiss Federation has stressed that the prospects according to the results of 2015 “looming shadow”. In November, a drop compared to the same month last year reached 5.6 percent.
The most affected segment of hours average cost (200-500 francs), here recorded a decrease of 15%. The main reason for the decline in exports in the Federation called competition from the producers of “smart” hours. It is strengthening Apple in this market has pushed, for example, Montblanc and TAG Heuer to create their own versions of smart watches. According to the median estimate of 11 analysts surveyed by Bloomberg this should give segment growth to 2%, but at the same time will hit the competing mechanical models.
The second reason is the reduced demand in Asian countries (sales in Hong Kong in December continued its annual decline and fell by another 21%) and USA (here, sales fell by 17.6%, the worst decline in the last five years). Delivery to France, where the number of tourists decreased after the terrorist attacks in November, in December decreased 8.6 %. John XX, an analyst at Kepler Cheuvreux, evaluates the Outlook is optimistic: other regions, such as China. Singapore and the UAE showing growth.
The share of hours accounted for about one tenth of Swiss exports. The overall reduction in Swiss exports in December amounted to 1.4%, delivery hours decreased by 3.8%.
It should be noted that not all Swiss watch manufacturers see Apple Watch competitor. So, Swatch Group CEO Nick Hayek has said that Apple is “interesting toy, not a revolution”. According to him, smart watches are rapidly aging the product at that time, as mechanical watches are for decades and passed down from generation to generation.
At the same time, the head of TAG Heuer Jean-Claude Biver has urged his colleagues not to ignore the success of Apple Watch. In a recent interview he stated that his company is in 2016 is going to sell 100-120 thousand copies of their version of “smart” hours, and by 2017, the year – over 200 000.