Another report by Malcolm Curtis.
Switzerland’s watch-makers are facing the first major slowdown in global exports in more than three years as sales drop significantly in November over the same month in 2007. The industry sees its biggest declines in orders to the United States, which plunged by a quarter, while demand for luxury watches selling for more than 3,000 francs is less severely impacted.
In another timely reminder of the accelerating economic slowdown in Switzerland, exports of the country’s watch-making industry fell sharply last month. The industry reports that sales to customers abroad in November fell 15.3 percent from the same month a year earlier to 1.5 billion francs.
The drop came in what is “traditionally the best month of the year," the Federation of the Swiss Watch Industry (FH) said in a statement released yesterday. “This decline clearly illustrates the curb on growth suffered by the industry as a result of the world economic climate,” the federation said.
The results mean that on an annualized basis, export growth has fallen below 10 percent – to 8.7 percent – for the first time since March 2005. Reductions were biggest in the United States, the second largest customer for Swiss watches, dropping almost 25 percent to 200 million francs. Sales to Hong Kong, Switzerland’s biggest customer for watches, fell 17 percent to 242 million francs. The two markets account for almost 30 percent of Switzerland’s exports.
The industry had initially managed to resist the impact of the global economic crisis. But it is beginning to feel the effects of the slowdown, which began with banking problems in the US and has since hurt business around the world. The number of Swiss watches exported in November fell by 500,000 or 17.4 percent to 2.3 million, with timepieces of all types selling in fewer numbers, except for those made of platinum. A total of 1,800 watches made with the precious metal sold last month, up more than 53 percent from a year ago.
The steepest fall was in sales of products priced at between 300 and 5,000 francs, which plummeted 30 percent. Luxury watches costing more than 3,000 francs fared better, posting just a 5.4 percent drop in sales value. Geneva brand De Witt was among the first to respond to the dropping sales this week when it announced a restructuring plan that will eliminate five administrative positions from a working force of 77. The company, which just opened new offices in Satigny last month, cited sales that have dropped since September, particularly from customers in the US and Russia.
Among the few markets to remain favorable for Swiss watch makers, Germany (up 9.1 percent) and France (plus 2.9 percent) are bucking the global trend, along with the United Arab Emirates.
source : http://www.swisster.ch
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