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The fine watchmaking fair returns to Geneva on Wednesday, but the conflict in Ukraine and the confinements in China cast a veil over this event expected following two years of pandemic.
From March 30 to April 5, 38 of the biggest watch brands, including Rolex, Patek Philippe, Cartier, Hublot and Tag Heuer, come to present their novelties at Palexpo, the major Geneva congress center, for the first major watch event for two years. .
“We are extremely happy to have succeeded in setting up this major fine watchmaking event in a difficult health and human context,” said Emmanuel Perrin, president of the Fondation de la haute horlogerie, in a press release. After two years of pandemic and 100% remote editions, “it was important to be able to bring together the main players in our industry once more”, he added.
This show called Watches & Wonders is an important event for this sector which employs 57,491 people in Switzerland, according to the statements of the Employers’ Convention of the watch industry for 2021.
Traditionally, many retailers then come to Switzerland to place their annual orders for their shops. But in the digital age, this show is also becoming a valuable communication tool to reach watchmaking fans on social networks, with a lot of videos and online presentations during the event.
Doubts regarding recovery
For this 2022 edition, the Haute Horlogerie fair should have made a triumphant return. Hard hit by the pandemic in 2020, the Swiss watch industry experienced a spectacular rebound last year with soaring demand for luxury watches.
After a 21.8% drop in 2020, Swiss watch exports rebounded 31.2% in 2021, according to customs, exceeding their pre-pandemic level but also their historical record of 2014. And for January and February, they still increased by 15.7% compared to the first two months of 2021, according to the watchmaking federation.
But the war in Ukraine cast a veil over this recovery, which nevertheless seemed to be off to a good start. Russia represents only 1.1% of Swiss watch exports. Even before luxury goods were included in European sanctions, several brands stopped exporting there.
But the sector is highly dependent on tourism and the desire to consume. Russia is also a major supplier of gold, precious metals and diamonds. The confinements in China, one of the biggest markets for Swiss watchmaking, add an additional shadow to the picture.
Some analysts have already lowered their forecasts for 2022. While they were expecting 8% growth for watch exports at the start of the year, Jon Cox, an analyst at Kepler Cheuvreux, has for the moment reduced its estimate at 5%.
This cut reflects both the shock to sales in Russia, the fall in travel spending by Russian customers in this sector which is highly dependent on tourism, and the psychological impact of the conflict on European customers.
“Psychologically, when there’s a war on your doorstep, you’re less inclined to go out and buy luxury goods,” he explains. According to him, however, watchmakers remain in good shape. “The watch industry is in great shape,” he notes, “probably the way it hasn’t been for almost a decade,” he adds.
On the announcement of progress in negotiations between Russia and Ukraine, Richemont and Swatch Group, the two major listed values in the sector in Switzerland, jumped on the stock market.
Throughout the week, the city of Geneva will once more vibrate to the rhythm of watchmaking. To take advantage of the arrival of wealthy collectors, other, smaller brands will meet for a separate show called Time to Watches. Others have rented rooms in major hotels to present their new pieces, while the auction house Christie’s will organize a cocktail party in a large contemporary art gallery around rare watches.
(AFP)