Business News: Swatch Group Hikes U.S. Watch Prices In Response To Rising Swiss Franc and Tariffs
Swatch Group AG, one of the biggest Swiss watchmaking groups, says it is raising prices on some watch models sold in the United States after the U.S. dollar slumped against the Swiss franc and the U.S. imposed higher tariffs on imported Swiss goods. A Swatch Group spokesman confirmed that the company was raising prices on some brands, citing “two main reasons” for the increases: the dramatic shift in exchange rates between the U.S. and Swiss currencies and increased tariffs.
The U.S. dollar has slumped agains the Swiss franc.
“The dollar weakened in the last four weeks by nearly 8%,” the Swatch Group spokesperson said. They also said that U.S. tariff levels on Swiss watches had increased to 10% from 3% previously. The Swatch Group controls a host of Swiss watch brands, including Omega, Breguet, Blancpain, Tissot, Glashütte Original, and its namesake Swatch marque. The spokesperson declined to say which brands would be impacted and by how much.
People familiar with the price increases said they expected prices for the Blancpain and German-made Glashütte Original brands to be impacted first. Blancpain prices would rise by 10% across all models while Glashütte prices would rise by about 7%, the people said.
Swatch is the first major Swiss group to impose price hikes in the U.S. in response to market shifts after U.S. President Donald Trump announced a slew of tariffs against trading partners, including Switzerland, which was hit with a 31% levy before the tariffs were paused temporarily. A 10% tariff remains in place for imported Swiss and European goods.
Gold prices have soared to a record amid the economic turmoil caused by tariffs.
The U.S. dollar has slumped in response to the economic turmoil caused by the trade policy decisions, giving strength to currencies such as the Swiss franc. At the same time, the price of gold, a key input cost for the Swiss watch industry, has soared about 10% in a month to record levels above $3,200 an ounce as investors look for safe havens. Rival Swiss watch groups, including brands owned by Richemont, LVMH, and Rolex SA, have yet to announce price increases in the U.S. Swatch Group’s move to hike prices for some models could see other brands follow suit.
Stay tuned to Hodinkee for more on this developing story.
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