Half-year results for the main luxury groups show that sales fell by between 25% and 45%. Signs of an upturn are beginning to appear, in particular at points of sale.
Articles on the subject:
Released mid-March, the third Morgan Stanley report, in collaboration with LuxeConsult, on the Swiss watch market shows that out of some 350 brands, the bulk of growth in 2019 came from the seven whose turnover exceeds CHF 1 billion. The analysis also highlights the outperformance of privately owned brands.
The outbreak of coronavirus could weigh heavily on watch brands' bottom line, given that the traditional Lunar New Year spending spree didn't happen. Asia, excluding the Middle East, accounts for 44% of Swiss watch exports, suggesting a chaotic year ahead.
An ongoing drop in volume exports, an inexplicable intervention by the competition watchdog, problems in Hong Kong, individual exhibition strategies... the face of the Swiss watch industry is changing in 2020.
The gap continues to widen between luxury watches and entry-level, resulting in a slight increase in total export value alongside a drastic decline in volume. Suppliers suffer as the sector becomes increasingly consolidated.
At $120 per share or €14.5 billion, LVMH's offer for Tiffany was judged too low. Now the battle is on between luxury mastodons, which includes Richemont and Kering, to take control of the storied American jeweller.
With protesters more determined than ever after four months of unrest, Hong Kong is struggling to maintain its status as a world capital of luxury. Economic recession in the special administrative region spells bad news for watch brands as shipments to this main export market have fallen by 6% since the start of the year.