Why luxury Swiss watch brands’ switch to steel could rebound on them
Top brands including Rolex, Piaget and Vacheron Constantin have launched steel-body watches to entice cost-conscious consumers, but they risk diluting their image and have scant room for manoeuvre, insiders say
Luxury Swiss watch exports continue their slide. It’s a familiar story and figures from August, the latest month for which statistics have been released by the Federation of the Swiss Watch Industry, show sales falling another 9 per cent year on year.
Hong Kong remains a key export market, but sales this year have fallen off the proverbial cliff, down 28 per cent in value year on year for the period from January to August.
“Things are bad, there’s no denying it, and it’s likely to get worse,” one watch executive told SCMP.com on condition of anonymity during a subdued launch event in September.
Time for a change? Hong Kong Watch and Clock Fair sees fewer visitors as industry struggles
The reasons for this collapse in sales have been pored over countless times by industry analysts. Chief among them are Xi Jinping’s crackdown on graft in China, a general slowdown of the Chinese economy, market saturation, the strong Swiss franc and the ever increasing market share of smartwatches.
Unlike the fashion industry, which can adapt to prevailing trends and wider economic conditions every six months, the mechanical watch industry can only correct its course every 18 months to two years, given the long arc of the design, manufacture and production process. Only now are we seeing some brands’ strategy to deal with the slump – many have looked to create more accessibly priced products primarily by introducing steel watches, or iconic pieces in steel variants.
The shift to steel began to creep in last year with big releases from the likes of Zenith, Montblanc and Jaeger-LeCoutre, but at 2016’s big trade shows, Salon International de la Haute Horlogerie in January and Baselworld in March, the biggest, most storied brands in the industry fully embraced steel.
