Blame the Apple Watch: Swiss watchmakers see exports decline in October

apple watch problems version 1461311033 wrist7 1500x1000
It was Swiss watchmaking legend Jean-Claude Biver who said in 2014 that the Apple Watch (and smartwatches more broadly) “wouldn’t create another crisis for the Swiss watch industry.” It now appears that Mr. Biver may have spoken too soon. According to a Swiss customs office statement released Thursday, October saw the biggest decline in the export of Swiss timepieces in six years: a 7.6 percent dip in global shipments, including a 12 percent decline in shipments to the U.S. alone, and a drop in total revenue of 2 billion Swiss francs ($2 billion).

It’s the continuation of a trend that began earlier this year. In August, exports fell 9.3 percent year-over-year — then the steepest monthly decline since November 2009. September witnessed a 9.9 percent drop in Swiss luxury wristwear shipments, bookending a Q3 that saw sales decline 8.5 percent. Since January, Swiss watch exports have slid 3.2 percent overall.

These sustained, precipitous drops are especially dramatic in context. In October 2014, Swiss watch exports made one of the highest year-on-year gains of the year — 5.2 percent. And 2014 was a record year for the Swiss watch industry overall, generating $23.9 billion in sales.

The natural inclination is to blame smartwatches, a market segment which is expected to reach $32.9 billion by 2020, but they’re far from the biggest factor. Analysts point to weak demand in Asian nations, especially Hong Kong, which saw its sales share of Swiss wristwear tumble 10 percent in October from the same period a year ago. Other overseas markets haven’t fared much better — in August, sales to China were 40 percent of total sales, down from 49 percent in July 2014, and in the same month the South Korea market shrank to 29 percent.

Still, analysts say the role of smartwatches in recent declines can’t be ignored. “Traditional watch makers are coming under pressure,” Ben Woods, Chief of Research at CCS Insights, told Tech Radar in October. “It would be naïve to think the Apple Watch has not impacted the traditional market in some form.”

The heirloom quality of high-end watches — traditions of passing watches down one generation to the next — has helped to shield luxury brands from the growth of wearable tech, but mid- and low-end brands haven’t been so lucky. Fossil projected a Q4 sales decline in this segment of as much as 16 percent.

That’s led some watchmakers like Swiss company Swatch to embrace digital with open arms. The company beat Apple to the mobile watch payments punch with a wearable it debuted in October (Apply Pay has yet to roll out in broadly in China).

But all the same, high-end brands aren’t hedging their bets. Tag Heuer and Movado introduced luxury smartwatches earlier this month. In February, a coalition of Swiss watchmakers including Frederique Constant, Mondaine, and Alpina announced a partnership with motion-tracking company Fullpower to create a unified smartwatch platform, MotionX.

Product Review

There’s almost nothing bad to say about the Mi Mix 3, but you still shouldn’t buy it

The Xiaomi Mi Mix 3 is good-looking, really well made, packed with features, and is a powerful, modern, desirable smartphone. But you probably shouldn’t buy it. Why? Nothing wrong with the device itself, but Xiaomi itself is mostly to…

Newegg slashes prices on PS4 accessories and AAA games like Anthem

Newegg is currently offering big savings on a number of games for PS4 and Xbox One, including Anthem, Metro Exodus, The Division 2, and Kingdom Hearts 3. Accessories including headsets are also on sale.

Amazon sale knocks $200 off the price of 13-inch MacBook Pro with Touch Bar

If you always wanted to buy a MacBook Pro but found it a bit too expensive, now is your chance to save. A base version of the 13-inch MacBook Pro with Touch Bar is currently on sale at Amazon for $1,600.

Make some time for the best smartwatch deals for March 2019

Smartwatches make your life easier by sending alerts right on your wrist. Many also provide fitness-tracking features. So if you're ready to take the plunge into wearables and want to save money, read on for the best smartwatch deals.
Movies & TV

Disney completes its $71.3 billion purchase of 21st Century Fox

Now that Walt Disney Company has closed its $71.3 billion purchase of 21st Century Fox's movie and television assets, what does this future hold for franchises like X-Men, the Fantastic Four, The Simpsons, and the rest?

Patreon is having another go at changing the way it charges creators

Patreon messed up pretty badly the last time it tried to change its payment system. Now it's having another go, though this time the changes mainly affect future sign-ups rather than its current community of creators.

Waymo boosts robo-taxi plans with new service center in Arizona

Waymo has announced plans for a facility in Phoenix, Arizona, that will help to service, maintain, and grow its fleet of autonomous Waymo One cars. The vehicles operate as part of the company's robo-taxi ridesharing service.

Google hit with another fine by the EU, this time for $1.7 billion

Google has been fined for the third time by the EU, this time for breaching antitrust laws by requiring third-party websites using its search function to prioritize its ads over competitors.
Home Theater

ESPN Plus scores the exclusive rights to UFC Pay-Per-View events

If MMA is your game, then ESPN Plus is now a very important player. The Disney-owned service locked up the exclusive rights to UFC Pay-Per-View events, a deal that will last through 2025 in the United States.

A new hope is lost as Disney dismisses rumors of a revival of Lucasfilm Games

According to job listings on the Disney website, the company has plans to revive Lucasfilm Games. This comes as a surprise following the shuttering of LucasArts in 2013 and could potentially mean more Star Wars games.

Epic Games is offering $100 million to game developers with no catch

Epic Games launched a new grant program called Epic MegaGrants. The program will dish out $100 million in funds to developers working in the 3D graphics community, even if they don't use Unreal Engine.
Home Theater

Tipping point? Streaming subscribers outnumbered cable in 2018 for first time

2018 was a very good year for the entertainment business as a whole, but it was especially good for streaming companies like Netflix and Amazon, says a new report by the Motion Picture Association of America.
Movies & TV

MoviePass returns to unlimited movies plan, but with plenty of restrictions

Troubled subscription-based movie service MoviePass is making headlines on a daily basis lately, and not in a good way. Here's a timeline of events for the company once described as Netflix for movie theaters.

5G's arrival is transforming tech. Here's everything you need to know to keep up

It has been years in the making, but 5G is finally becoming a reality. While 5G coverage is still extremely limited, expect to see it expand in 2019. Not sure what 5G even is? Here's everything you need to know.