Swiss Watch Exports Drop in May After Tariff Surge: What’s Next for the Industry?

The Volatile Trend of Swiss Watch Exports in 2025

 

Swiss watch exports have been on a wild ride in 2025. After experiencing an unexpected surge in April, the industry saw a dramatic decline of 9.5% in May. Exports totaled CHF 2.1 billion in May, indicating a sharp market correction following a sharp spike the month before. This volatility is not just a result of fluctuating consumer demand but largely due to shifting trade policies, particularly the anticipated tariffs from the United States, and broader economic uncertainties.

The Roller Coaster of Swiss Watch Exports in 2025

Swiss watch exports have been on a wild ride in 2025. After experiencing an unexpected surge in April, the industry saw a dramatic decline of 9.5% in May. Exports totaled CHF 2.1 billion in May, indicating a sharp market correction following a sharp spike the month before. This volatility is not just a result of fluctuating consumer demand but largely due to shifting trade policies, particularly the anticipated tariffs from the United States, and broader economic uncertainties.

This shift in export trends comes as no surprise, following the sharp increase in exports earlier in the year. According to a report on Hodinkee, the surge in April was largely fueled by panic buying ahead of the anticipated tariff increase. The drop in May reflects the return to a more stable market dynamic, but it’s clear that the fluctuations have caught the attention of the industry.

The April Surge: Panic Buying and Stockpiling Before the Storm

April 2025 witnessed an extraordinary spike in Swiss watch exports, primarily due to speculation about potential tariff increases. U.S. President Donald Trump’s threat of a 31% tariff on Swiss imports, including watches, set off a wave of panic buying, with retailers rushing to stockpile products in anticipation of higher prices. As a result, exports to the United States surged by a staggering 149%, accounting for over 40% of the global increase in Swiss watch exports that month.

This surge, however, was far from a sign of lasting demand. It was a temporary market reaction to the tariff uncertainty. The Federation of the Swiss Watch Industry (FH) was quick to point out that the rise in exports was largely driven by panic buying rather than genuine consumer demand. By May, the U.S. market corrected itself, with exports to the country plummeting by 25.3%. What followed was a return to more typical export levels after the temporary demand boost of April.

A report from Barrington Watch Winders highlights how the tariff surge has created uncertainty not only for manufacturers but also for consumers. Retailers must now adapt to shifting expectations, and it’s clear that this volatility isn’t likely to disappear soon.

May Decline: The Broader Global Slowdown

The May 2025 decline wasn’t just an American problem. Other key Swiss watch markets, including China, Hong Kong, Japan, and the U.K., saw significant drops as well. The broader market correction signals a more cautious global economic outlook, with consumers tightening their purse strings.

In China, the world's second-largest market for Swiss watches, exports fell by 17.4%. This drop is part of a larger trend, with China's economy continuing to struggle due to a real estate crisis and slowing domestic demand. Similarly, Hong Kong, once a major market for Swiss watches, experienced a 12.6% drop. Japan and the U.K. also saw declines of 10.5% and 14.5%, respectively. These widespread declines suggest that the impact of U.S. tariff concerns is being felt more broadly across the global watch market.

The WatchPro article further explores how the slump in exports to the United States has significantly contributed to the global slowdown. As many Swiss watch brands face growing competition from new players and shifting market preferences, this slowdown may become a long-term trend rather than a brief setback.

Price Segments and the Pressure on Lower-Priced Watches

 

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The impact of this market contraction was felt across almost all price categories. Swiss watch exports saw a decline of 9.0% for those priced with precious metal cases, while stainless steel models dropped by 9.3%. More niche segments, such as bimetallic and synthetic models, experienced even steeper declines, with the latter segment falling by a sharp 38.4%.

Perhaps most telling was the impact on lower-priced categories. Watches priced under CHF 3,000 were particularly hard hit, as they continue to face increased competition from smartwatches and fashion brands. Exports in this range saw a noticeable decline in both volume and value. Even high-end watches, those priced above CHF 3,000, saw a drop of over 8% in export volumes, showing that even the affluent consumer segment is becoming more cautious.

However, the upper mid-range segment, where watches are priced between CHF 500 and CHF 3,000, showed some resilience. Although the volume of exports in this category declined slightly, there was a marginal increase in export value, suggesting that buyers are still willing to pay for brand prestige and perceived value, even in a more cautious market.

Tariffs and Economic Uncertainty: Shaping the Swiss Watch Landscape

 

The uncertainty surrounding U.S. trade policy has played a pivotal role in shaping the Swiss watch export trends. Even though the tariff proposal was reduced from 31% to 10%, the uncertainty about future U.S.-Swiss relations continues to influence consumer behavior. Swiss watch brands, including the likes of Rolex, Omega, and Audemars Piguet, have been forced to adjust their pricing strategies, especially in the U.S. market.

The Fed’s recent remarks about the global economic outlook, combined with lowered GDP growth projections, only add to the prevailing sense of uncertainty. The luxury goods market, including Swiss watches, is particularly sensitive to these shifts, as high-end consumers adjust their purchasing behavior in response to economic instability.

As luxury watch prices rise due to tariffs and inflation, buyers are becoming more selective, scrutinizing their purchases more carefully. The lingering threat of tariff instability has created a hesitancy in the market, making long-term consumer commitment more difficult to achieve.

The 2025 Outlook: A Market in Transition

While the first five months of 2025 saw a modest 1.1% increase in Swiss watch exports compared to the same period in 2024, the overall picture is far more complex. The surge in exports in February and April helped the figures, but the May slowdown highlights the broader caution in the market.

Moving forward, the Swiss watch industry will need to navigate a series of challenges. These include inflationary pressures, currency fluctuations, and geopolitical tensions, all of which contribute to a more cautious global luxury market. The shift away from the strongholds of China and Hong Kong signals that brands need to reconsider their strategies and potentially target emerging markets with more resilience.

The Middle East, especially the United Arab Emirates, stands out as a beacon of hope in this climate. The region saw growth in May, driven by a boost in tourism and a robust luxury retail environment, particularly in Dubai. Brands may find more long-term success by adjusting their strategies to cater to these regions, as well as India, which is also seeing a growth trajectory in luxury consumption.

Conclusion: Adapting to a Volatile Market

The decline in Swiss watch exports in May 2025, following the surge in April, underscores the unpredictable nature of the luxury watch market. While the U.S. remains a key player, the global picture is marked by growing uncertainty, economic caution, and evolving consumer preferences. Swiss watch brands must adapt to this shifting landscape by refining their strategies, adjusting their portfolios, and managing inventories more efficiently.

As the market continues to evolve, the industry’s focus will likely shift towards innovation, sustainability, and targeting more resilient consumer segments. For consumers, the combination of tariffs, economic instability, and the growing range of alternatives available means that purchasing decisions will increasingly be influenced by value, prestige, and long-term reliability.