Patek Philippe’s chief says he is not
anxious about the prospects for top-end timepieces, despite Swiss watch
exports slowing overall after three years of spectacular growth.
Thierry Stern told AFP he was “not worried about the high end” of the
market during the Geneva watch fair, which brings together 54 major brands at
Swiss watchmaking’s landmark annual event.
For lower- and mid-range brands, “I think it must be tougher”, especially
as there is “more competition” at those levels, Stern said at the Watches and
Wonders salon, which opened on Tuesday and runs until Monday.
“But for Patek Philippe, I am not worried,” said the president of the brand
which ranks among the most prestigious in Swiss watchmaking.
“Right now, I can’t think of a market in trouble — not at the top end, in
any case,” Stern said.
The United States for example, which accounts for 38 percent of Patek
Philippe sales, remains a “collectors’ market” for the brand, he said.
“Europe is doing very well too,” he added, and if “Asia was a little
tougher for a while”, then “today it’s back up again”.
Known for its complex timepieces, Patek Philippe is presenting a new
version of its World Time model at the salon. It comes in white gold with an
opaline blue-grey dial, and a price tag of 65,000 Swiss francs ($71,400).
‘A little calmer’
Swiss watchmaking had a brutal shock in 2020 as the Covid-19 pandemic
hammered sales.
But the sector quickly rebounded, and broke records three years in a row,
with exports reaching 26.7 billion Swiss francs ($29.5 billion) in 2023.
However, exports saw their first significant year-on-year decline in
February — down 3.8 percent compared with February 2023.
That said, not all brands are feeling the effects.
Globally, across the luxury goods sector, the top two percent of customers
account for about 40 percent of sales, according to the US management
consultants Bain & Company.
The most high-end brands, like Patek Philippe, rely on a very wealthy
clientele that is not particularly exposed to the vagaries of the economy —
meaning those brands are well placed to withstand slower phases across the
industry.
For Stern, the fourth generation of his family at the helm of Patek
Philippe, the recent slowdown is perhaps a sign of “a return to reality” after
three years in which watch sector sales “exploded”.
“We can’t say it’s a crisis,” it’s just “a little calmer”, he said.
This year, he intends to keep production at the same “record” level of
72,000 timepieces reached last year.
Established in 1839 and owned by the Stern family since 1932, the private
company never reveals its turnover.
According to an estimate by the US bank Morgan Stanley and the consulting
firm LuxeConsult, the company’s sales reached around 2.05 billion Swiss francs
last year, up 14 percent on the previous year.(AFP)
