Export Surge Cushions Short-Term Impact of Tariffs on Swiss Luxury Watches

Geneva — Swiss watchmakers remain optimistic about the US luxury watch market despite a steep 39% tariff imposed by the Trump administration in mid-2025. At the annual Geneva Watch Days, industry leaders said robust July exports and existing stockpiles are helping soften the immediate blow, though concerns loom once inventories run low.

US Tariffs on Swiss Watches – A 39% Challenge

The United States imposed the highest-ever tariff on a developed nation, aiming to boost domestic manufacturing. For Swiss watchmakers, the US is their most critical overseas market, representing nearly 20% of global sales. In the first half of 2025, exports to the US reached 2.6 billion Swiss francs ($3.3 billion).

Executives, including Breitling CEO Georges Kern, voiced cautious optimism that Swiss negotiators will soon secure a reduced tariff, similar to the 15% rate granted to the European Union. Kern emphasized that backup inventories would buffer disruptions in the short term:

“This should be solved, or partially solved, in the following weeks or months.”

Export Surge Ahead of Tariffs

July 2025 saw a 6.9% surge in Swiss watch exports, as brands rushed shipments before the tariff deadline. However, outside the US, global exports dipped 0.9%, suggesting that the current momentum may slow once stockpiles deplete.

Mixed Strategies from Swiss Watch Brands

The industry’s response has varied:

• Favre Leuba has paused US expansion, citing uncertainty.
• ZRC 1904 continues forging ahead with new US retail partnerships.
• Watches of Switzerland Group reported strong US sales, signaling resilience in luxury demand despite trade headwinds.

These divergent strategies reflect both the risks and opportunities in the American luxury goods market under the new tariff regime.

Ongoing Swiss-US Trade Negotiations

Swiss officials are pressing Washington for tariff relief.

• Delphine Bachmann, Geneva state councilor, criticized the disparity with Europe as “shocking.”
• Guy Parmelin, Swiss Vice President, described talks in Washington as “constructive.”

Industry leaders hope that diplomacy will narrow the tariff gap and stabilize long-term market access.

Why the US Market Matters for Swiss Watches

The US remains a vital growth hub for Swiss luxury watchmakers:

• Accounts for ~20% of Swiss watch exports.
• Valued at $3.3 billion in H1 2025.
• Strong consumer demand for brands like Swatch Group, Richemont, and Rolex.

Without tariff relief, analysts warn of declining exports in late 2025 as inventory buffers run out.

Key Takeaways

• Swiss watches face a 39% US tariff, highest ever on a developed nation.
• July exports rose 6.9%, but global exports fell 0.9% excluding US sales.
• US market critical: 20% of Swiss exports, worth $3.3B in H1 2025.
• Mixed brand strategies: Some pause expansion, others push ahead.
• Swiss-US talks ongoing, aiming to reduce tariff to EU’s 15% level.
• Industry outlook: Optimism remains in the short term, but concerns grow if tariffs persist beyond 2025.

FAQs on Swiss Watch Tariffs in the US (2025)

Q1: What tariff did the US impose on Swiss watches?
A 39% tariff, the steepest ever placed on a developed nation, effective mid-2025.

Q2: Why is the US important for Swiss watchmakers?
The US accounts for about 20% of Swiss watch exports, valued at $3.3 billion in just the first half of 2025.

Q3: How are brands responding to the tariffs?
Some brands, like Favre Leuba, have paused expansion, while others, such as ZRC 1904, continue to expand retail partnerships.

Q4: Did exports rise or fall after the tariffs?
Exports surged 6.9% in July 2025 as companies shipped early, but global exports fell slightly (-0.9%) excluding US shipments.

Q5: Are negotiations underway to reduce tariffs?
Yes. Swiss officials are in talks with Washington, seeking to align tariffs closer to the EU’s 15% rate.

Q6: What happens if tariffs remain in place?
Analysts predict a slowdown once existing inventory stockpiles run out later in 2025, potentially hurting long-term growth.

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