Time to Work By Macro Problems for Executives

GENEVA — The newest version of the Watches and Wonders honest was able to symbolize the watchmaking business’s rebound.

Rallying after a uneven 2024, the sector regarded poised aimed to faucet into the facility of optimistic considering in opposition to regardless of the unstable social and financial backdrop. A free-trade settlement signed with Thailand in January additionally learn as an encouraging signal, provided that market’s urge for food for luxurious.

Between April 1 and seven, the honest gathered 60 manufacturers on the Palexpo exhibition heart that broke new information, showcased world premieres and supplied an ever-growing array of technical and creative legerdemain of their newest high-end timepieces. 

Guests this 12 months topped 55,000, a 12 p.c enhance, whereas the general public days noticed a 21 p.c leap in ticket gross sales versus 2024, to achieve 23,000. 

There was additionally star-power aplenty, from “Bridgerton” and “F1” actress Simone Ashley and China’s NiNi, to sporting legends Roger Federer and Carl Lewis. The honest’s estimated attain on social media exceeded 700 million folks, in keeping with organizers. 

Cyrille Vigneron, president of the Watches and Wonders Geneva Basis, mentioned the honest had established itself not solely as a “must-attend” occasion for professionals, however was additionally “a platform for expressions” for watchmakers. 

For guests, it was “an immersive expertise within the watchmaking business,” mentioned Matthieu Humair, the muse’s chief govt officer. Given the sturdy lineup of recent releases by manufacturers, he felt “the 12 months can be dynamic for the business.”

However this sunny outlook was marred by the proverbial bolt out of the blue — U.S. President Donald Trump’s April 2 announcement of sweeping tariffs that might see a 31 p.c levy slapped on Swiss items getting into the U.S.

Too Quickly to Discuss

That rapidly turned the elephant within the room on the honest. 

With first-quarter outcomes looming and European luxurious shares plunging within the quick aftermath of the tariffs information, many executives skirted questions round potential impacts or mitigating methods, as an alternative reiterating the significance of the U.S. marketplace for the business.

In 2024, the U.S. was the biggest marketplace for Swiss watch exports, rising 5 p.c year-on-year to 4.37 billion Swiss francs, or $5.3 billion.

Nonetheless, some executives have been vocal on the topic.

“We’re disillusioned by the imposition of such excessive customs duties on Swiss merchandise and Swiss watches,” mentioned Yves Bugmann, president of the Federation of the Swiss Watch Business. 

He added that tariffs on Swiss timepieces “can’t be thought of a matter of honest reciprocity,” given the shortage of import duties on American timepieces getting into Switzerland, which additionally abolished all industrial tariffs on Jan. 1, 2024. 

Within the aftermath, the Swiss Federal Council determined in opposition to countermeasures, preferring a diplomatic route, with representatives heading to Washington, D.C., in hopes of negotiating with U.S. authorities.

For Jon Cox, head of European client equities at Kepler Cheuvreux, a 31 p.c tariff would quantity to “round a mid-teen [percentage] worth enhance on the retail stage” as it’s utilized based mostly on worth at export. He estimated such a rise can be more durable to move on to shoppers for lower-priced objects, forcing watchmakers, importers and retailers to soak up among the tariff-led will increase. 

“For higher-end watches, shoppers are wealthier and may soak up extra of the value rise, significantly for supply-constrained watches akin to Rolex, Patek and [Audemars Piguet],” Cox continued. “Nonetheless, high-end retailers akin to Watches of Switzerland are in all probability going to see strain on margin, significantly for nonsupply-constrained watches. Producers will in all probability take among the ache, [with] an influence on their profitability.”

He projected “low-single-digit progress for the market general, led by the high-end [watches priced above 3,000 Swiss francs at export], whereas all different worth factors being down” for 2025.

That’s a situation that didn’t keep in mind potential run-on penalties, like “potential secondary results akin to an financial slowdown, if not recession within the U.S., which might have a way more unfavourable influence on the business,” the analyst added.

A ten p.c tariff stage would make the state of affairs “much more manageable each at cheaper price factors and for high-end watches,” Cox concluded.

Execution of tariffs for all nations besides China has since been suspended by Trump for 90 days, leaving Switzerland with the ten p.c fee utilized globally that kicked in on April 5.

Alternatives within the Entry-price Taking part in Subject

The one certainty was that “the state of affairs remains to be very new and shifting, and there can be quite a lot of negotiation,” mentioned Davide Cerrato, CEO of watchmaker Bremont. 

As a British firm, it might be impacted to a lesser diploma since items from the U.Okay. are topic to the decrease 10 p.c tariff, serving to it seize market shares within the U.S., the place enterprise is booming for Bremont. 

Moreover, there may be a good greater alternative that the 23-year-old unbiased model plans to faucet: the low-to-mid four-figure phase, thought of the entry stage of advantageous watchmaking. That focus has paid off within the wake of the launch of TerraNova, a military-inspired area watch launched final 12 months then expanded with a leaping hour caliber launched at this 12 months’s honest. 

“Plugged on the entry of our 2,500 to three,500 [British] kilos provide, it paid off large time,” Cerrato mentioned. “As a comparatively younger model that’s rising, recruiting new prospects, particularly younger ones, is an enormous subject, and it’s precisely what TerraNova is permitting us to do.”

The reasonably priced luxurious territory, significantly the $2,000 to $4,000 vary, is the one Frédérique Fixed can be tapping. 

“That’s a market that’s not rising, nevertheless it’s rising for us considerably as a result of everyone went over $4,000 to $5,000, and it opened up a really large white area for us,” mentioned Jeffrey Cohen, president of Citizen Watch America, which owns the watchmaker. 

It’s good enterprise with its core buyer, within the late 30s to 40s age bracket, and is an overture towards a youthful demographic, such because the 30 to 40 p.c of tourists aged 25 or beneath that got here to the Frédérique Fixed sales space throughout final 12 months’s public days on the present. 

Such a client is savvy and “needs to be happy, [not] stunned,” the chief mentioned. What they need is a timepiece with genuine watchmaking credentials. Therefore choices just like the Traditional Perpetual Calendar that embarks the FC-776, the model’s thirty fourth in-house caliber cadenced at 4 Hz providing a 72-hour energy reserve, priced at $9,995. 

“This era is liking what we’re doing,” Cohen mentioned. “Not everyone can afford a $10,000 watch.”

Unbiased label Oris is one other model positioned in that sparsely occupied worth phase. 

“The entire Oris mantra product is about worth worth,” mentioned V.J. Geronimo, the corporate’s CEO for the Americas. “It’s about providing a extremely good look ahead to the cash, with all of the options. So a $2,000 Oris is any person else’s $3,500 [watch].”

He anticipated its raft of colourful Large Crown Pointer Dates fashions and a refreshed visible identification — a pink and inexperienced livery — to proceed elevating model notion. Within the U.S., the model is the official luxurious watch of the New York Yankees baseball staff.

As a result of They’re Value It

Enhancing the perceived worth of designs and providing worth for cash — regardless of the worth level — got here up in each dialog. 

A key concept for Panerai is upgrading its core Luminor Marina household with enhanced water resistance, plus slimmer profile and motion, all with out touching its worth, mentioned chief advertising and marketing officer Alessandro Ficarelli, including: “We need to develop by worth, by including worth for the ultimate shopper, not growing the value of our watches.”

With 95 p.c of recent shoppers amongst patrons of this mannequin, priced 8,900 euros for a 44-mm metal model and as much as 9,990 euros for a titanium take, the model stays an entryway into the model — and fashionable amongst current shoppers. 

Patrick Pruniaux, CEO of Ulysse Nardin and its mum or dad group Sowind, mentioned he’s “a powerful believer within the promise to the buyer, to the watch fanatic.”

For Ulysse Nardin, that’s “nice technological content material, nice innovation, transparency,” as epitomized by the Diver Air mannequin launched in Geneva. “We don’t play video games or attempt to enhance our income by simply including 10 or 15 p.c on the identical product,” he mentioned.

Whereas many have described the lackluster Swiss timepiece gross sales as a normalization, Pruniaux known as the state of affairs “a decline,” albeit one after a few years of sturdy progress. 

“On this setting, it’s very fascinating for watch lovers to take a look at a timepiece or model and really feel they perceive what the model is saying, significantly for independents,” he mentioned. “However you don’t want a PhD in Ulysse Nardin to purchase a Ulysse Nardin.”

Having a transparent message, even one which feels polarizing, has served the model nicely, as has a prudent software of furlough, to the tune of 1 week each two months, of 15 p.c of its workforce in a bid to maintain skills within the firm whereas saving prices.

Regular Palms, Strong Roots

For Guillaume de Seynes, Hermès Worldwide’s govt vp, manufacturing division and fairness investments, navigating an setting ever-more unpredictable is about having a gentle hand and agency grasp on what home fundamentals are.

It means on the one hand maintaining to the model’s general strategy to creation based mostly on amazement and shock — cue the Arceau Rocabar de Rire, that includes a horse displaying its tongue — and making certain merchandise, be they extra accessible quartz watches or high-end timepieces, stay consistent with an general “at all times very prudent strategy to pricing” and a deal with cultivating native shoppers first, he mentioned.

“What we will say is that we’re proud of the course we’ve got taken in watchmaking for 20, 25 years and that our ambitions don’t cease there,” de Seynes mentioned, including that “2025 will possible not be simple. After we see export figures, there received’t be a big upturn in comparison with 2024. However we’ve got confidence within the midterm, that’s why we’re doing this large funding in Noirmont,” Switzerland.

That venture, as a result of begin in July, will see the sq. footage of the power, which is devoted to instances and dials, triple in round two years’ time, whereas manufacturing will proceed on-site.

Hublot CEO Julien Tornare additionally didn’t see the present context as a cause to curtail deliberate investments, together with new amenities in Nyon, Switzerland, which might be scheduled to be accomplished in simply over a 12 months. They’ll embody a 4,000-square-foot showroom and hospitality tasks are on the playing cards.

The model is buoyed by a good distribution amongst main markets akin to China, the U.S., Europe and the Center East, coupled with a powerful begin in new markets like Indonesia, Vietnam and India. 

In his opinion, the present outlook isn’t in disaster mode, however a correction that indicators “a return to a normality we had misplaced in 2021 and 2022.” Nonetheless, the speculative bubble, which noticed a surfeit of product land available on the market, must be addressed. 

Given as we speak’s geopolitical context, you will need to “return to fundamentals, recreate rarity on one’s model and ensure [to be] very dynamic,” he mentioned.

Particularly, watch portions can be intently monitored. “I consider it’s a must to maintain a pressure out there — that’s what good manufacturers do as we speak,” Tornare mentioned. 

Emotion as Added Worth

One recurring and important cog that retains the watch enterprise ticking stays immaterial: emotion. 

“With out emotion, you don’t do something nicely,” mentioned Laurent Lecamp, international managing director of Montblanc. 

In a time of transformation for luxurious industries, the emotional element is crucial to attach a product’s story to a model and likewise to shoppers’ personal lives. “Should you do it the suitable approach, you’ll achieve success,” he mentioned. “Should you attempt to be fashionable, you’ll disappear.” 

Including worth is available in some ways. Montblanc is providing upgrades to the Zero Oxygen case expertise to current homeowners, to match the pair of recent 38-mm Iced Sea Automated Date with Zero Oxygen instances launched this 12 months.

“We need to present to folks that whenever you spend money on a Montblanc timepiece, it’s an actual funding,” mentioned Lecamp, including the improve technique can be sustainable.

At Piaget, it’s the lengthy view, quite than month-to-month watch export tallies, that issues.

“[Those are] a market evaluation however one shouldn’t fixate on it,” mentioned Piaget’s CEO Benjamin Comar. He mentioned it’s key to spotlight a model’s residing patrimony — or DNA — by means of innovation and modernity, to make sure its longevity.

In Piaget’s case on the honest, that took the form of the Sixtie, its first new watch assortment in over a decade. Comar additionally highlighted that “the power to transmit additionally created an funding worth” for shoppers — and types.

Be True, however Most of All, Be You

All through the honest, watchmakers introduced up consistency and authenticity. 

“What resonates increasingly is the authenticity and proximity [to the] household that’s behind the creations and the craftsmanship that we cherish,” mentioned Chopard copresident Karl-Friedrich Scheufele.

Living proof: the Alpine Eagle, which noticed three generations of the Scheufele household work on the elegant built-in sports activities watch. “[That’s] actually one thing that our shoppers cherish,” he mentioned. “There’s a message that goes past the product and [we could sense] that was felt.”

That’s what helped cement the pandemic-driven increase Chopard acquired, enabling the mannequin to change into a sought-after various to watches from different manufacturers that had instantly inaccessible.

“We benefited from that, after which we have been in a position to construct a following which isn’t a lot speculators however [people] who’re nonetheless concerned with watches as we speak,” Scheufele mentioned. “Whereas [speculating buyers] have moved on to different speculative fields.”

Likewise for the Ferdinand Berthoud model, additionally beneath the Chopard umbrella.

“We keep true to the course of perfection and precision, and we don’t commerce the potential of making extra watches in an moral, genuine approach,” Scheufele mentioned.

“We did go from initially 10 to twenty to now perhaps 60-something watches produced in a 12 months [yet] utilizing different means we may have carried out 100 or 150,” Scheufele continued. “However it wouldn’t be the identical. That is one thing that slowly however absolutely sinks in. Folks perceive that and respect it.”

Watchmaking “has advanced rather a lot, however magnificence and innovation are in all probability the important thing as we speak to watchmaking lovers,” mentioned Catherine Rénier, CEO of Van Cleef & Arpels. “Our universe is so identifiable that so long as we stay true to ourselves, we’ve got a voice on this very populated world of watchmaking. What is good is that everyone is impressed by their very own universe, enriching watchmaking in a greater approach.” 

Repeating a message isn’t risking client fatigue — it’s important to entrench one’s identification and in the end stand out.

“For the [past] years, Cartier has been maintaining the identical technique, the identical route in the case of watches,” mentioned the French jeweler’s chief advertising and marketing officer Arnaud Carrez. “At the moment, Cartier could be very profitable in watches, and this primarily depends on the truth that we’ve got a transparent distinctive positioning on this planet of watchmaking because the watchmaker of shapes.” 

Cartier this 12 months pushed ahead the route of sculptural instances and complex gem-setting, paired with commercially engaging choices that included the Tank à Guichets, the Panthère de Cartier, the excessive jewellery Panthère bangle and the Tressage form. 

Making one’s mark is about depth in creation, mentioned Jérôme Lambert, who returned in January for a second tenure as CEO of Jaeger-LeCoultre.

“The clientele has by no means been as various,” he continued. “[Given] the way in which communication features as we speak by affinity, by [country], by cut up, we’ve got to have an excessive depth, if we need to seize their consideration throughout that slot of time.” 

The proper of consideration may even open doorways.

“Watches have that potential — we see it [at the fair] — to convey a brand new kind of shopper that is aware of of Chanel however discovers one thing a bit completely different, a bit stunning,” mentioned Chanel watch and jewellery president Frédéric Grangié. “The truth that we’re very younger on this extremely aggressive market, when you’ve got severe watchmaking to again it up, could be a bonus as a result of the liberty of creation is complete.”

If carving that path ends in firsts, akin to making use of enamel on ceramic for the J12 Dripping Artwork set, which mimics nail polish splashed throughout a quintet of watches, it’s happenstance. 

“We’re not in search of gold medals in innovation,” Grangié mentioned. “We would like innovation to be on the service of what Arnaud [Chastaingt, director of the Chanel watchmaking creation studio] has in thoughts.”

And it’s paying off: a male collector was the primary to snap up the Boy.good friend “Coco Artwork” with a dial enameled by Les Cadraniers de Genève.

A 12 months of Milestones

For a lot of Watches and Wonders exhibitors, the deal with identification and experience was made all the better by milestones in 2025.

In 2000, Bulgari debuted in watchmaking, whereas Chanel and Chopard launched their J12 and L.U.C. Chopard Quattro fashions, respectively.

Hublot marked 20 years of its Large Bang watch with a “Supplies and Excessive Complication” set priced at 1 million Swiss francs and a celebration with ambassadors, akin to retired sprinter Usain Bolt, soccer champion Kylian Mbappé and a minimum of 43 Michelin stars amongst from 5 cooks together with Yannick Alléno and Anne-Sophie Pic.

Elsewhere, Roger Dubuis turned 30, whereas Vacheron Constantin hit the 270 mark, releasing six restricted anniversary editions of its Patrimony and Traditionnelle timepieces, all bearing a particular end and anniversary emblem on their actions.

Zenith traded splashy shows for 4 particular editions restricted to 160 items every.

“We determined to do what we do greatest — watch actions,” mentioned CEO Benoît de Clerck.

Within the lineup have been brilliant blue ceramic takes on its Chronomaster Sport, Defy Skyline Chronograph and Pilot Chronograph strains, in addition to the Zenith G.F.J Calibre 135, which embarks its historic caliber that received some 230 awards for chronometry over the many years.

Utilizing an anniversary as “a chance for us to elucidate what the model is all about” is essential at a time the place shoppers are looking for authenticity and relatability over bling impact, the Zenith CEO mentioned. 

Standing Collectively, however Standing Out

Executives agreed that Watches and Wonders served as an announcement of the business’s vitality and vibrancy, with a necessity to specific themselves to the suitable viewers of collectors and lovers.

“It’s that one second in time the place the business is punching above its weight and whoever has any curiosity in watches will take a look at [what] is going on particularly this week,” mentioned Wilhelm Schmidt, CEO of A.Lange & Söhne. “Then, after all, some folks will dive deeper into it and a few received’t.”

However even the XXL model of this 12 months’s star grand complication Minute Repeater Perpetual that took pleasure of place on the sales space isn’t a bid for international consciousness. Schmidt mentioned he’s “extra eager on being identified to the people who find themselves keen about watches,” significantly in mild of the model’s restrained watch manufacturing. 

As such, having solely three releases was A-OK. “Should you solely do not forget that we introduced three lovely watches, my mission is completed,” he mentioned. 

“To face out and be prime of thoughts, you should create related and impactful novelties — that’s the responsibility of all manufacturers, not simply Bulgari,” mentioned Jean-Christophe Babin, CEO of the model. “It’s the responsibility of all manufacturers, as a result of if we would like that class to proceed to develop, we’ve got to innovate, shock and create want, and that is one option to create want.”

Becoming a member of the honest for the primary time, Bulgari actually stood out due to the Octo Finissimo Extremely Tourbillon, its tenth document of thinness.

Babin, who not too long ago turned CEO of LVMH Moët Hennessy Louis Vuitton’s watchmaking division, lauded Watches and Wonders as doing a lot good for the sector, “not solely showcasing the information, [as] Basel used to do, however offering quite a lot of clues, quite a lot of backstage on the artwork of watchmaking, and subsequently additional enhancing and justifying the worth for the value of these watches.”

“Folks have to know the ‘why,’ and when you clarify [it], it’s not that they are going to purchase 10 [watches], however they are going to perceive that they’re shopping for one thing extraordinarily beneficial, uncommon, crafted,” mentioned Babin. “A chunk of artwork — it goes past the watch.”