Published on January 15, 2025 at 1:08 p.m. / Modified on January 15, 2025 at 1:10 p.m.
Watchmaking is suffering at the moment. And that’s not unusual. The historian Pierre-Yves Donzé has established that over a long historical period beginning in the 19th century, watchmaking experienced on average one year in four of recession. So, are we in crisis in 2025? We will start by introducing a small nuance: the industry continues to operate at high speed. Even if there is a slowdown, the players who support the sector are still doing quite well and the Swiss industry still has no direct competition. We are producing fewer and fewer watches but they are still worth more.
Inflation, geopolitics, but especially China, slowing factors
The big question is when will growth return? No one expects a market turnaround before the second part of the year. Maybe not before 2026.
Where does the problem come from? There are external causes: inflation, all the geopolitical insecurity, the strength of the franc. But there is one main factor which is China. China has been an engine of growth for almost twenty-five years and this engine, in 2024, has stopped.
Pascal Botteron, of Cité Gestion, is reassuring: “There are alternative markets: India and Mexico, to which we must add the United States, where the consumption of luxury goods is also increasing.”
So, there are external causes and then there is also a cause that is specific to the industry, in which production capacities are always under pressure.
Produce fewer watches?
This phenomenon invariably leads to saturation of distribution channels. Clearly, there are too many watches on the market and these stocks will have to be absorbed before we can begin the next phase of growth. This is exactly where we find ourselves today.
“We feel that there is an ambient nervousness to use chosen terms” confides Jérôme Biard, director of Roventa Henex, manufacturer of watches for client brands (Private label) before continuing: “We plan, for the first quarter of 2025 , to call on reductions in working hours for certain workshops. We realize that we need to produce less but be more in tune with the market.”
This video was produced as part of the Horizon Forum, an event organized by Time on January 30 at IMD Lausanne to explore avenues for strengthening Switzerland on the international scene. on Thursday, November 14 at the University of Lausanne. More information
