Why the Swiss Watch Industry Should Focus on the Indian Market, According to Deloitte

India and Mexico are poised to become significant catalysts for growth in the Swiss watch industry. This comes at a time when the sector has been affected by U.S. tariffs and dwindling demand in China, according to a recent report by the audit firm Deloitte.

The Swiss watch industry is currently facing one of its most challenging periods, as highlighted in the 11th Deloitte Swiss Watch Industry Study. As the third-largest export sector for Switzerland, watchmaking has struggled notably after the U.S. imposed a hefty 39-percent tariff on Swiss goods in August.

Additionally, exports to China—a vital market for Swiss watchmakers—have continued to diminish. Factors contributing to this decline include high youth unemployment and instability in the real estate sector in China.

Data from the Federation of the Swiss Watch Industry (FH) shows that last year, Swiss watch exports to the U.S. totaled 4.4 billion Swiss francs (approximately 5.5 billion dollars), marking a 5 percent increase from 2023. Conversely, exports to mainland China dropped to two billion francs, a decline of 26 percent.

Karine Szegedi, Deloitte Switzerland’s head of consumer, luxury, and fashion, emphasized the importance of capitalizing on emerging markets. “Finding new growth regions is vital to cushion the declines we’re seeing in established markets,” she noted.

Emerging Watch Markets

Deloitte previously recognized India as a promising market for watchmakers in its 2023 report. Following the signing of a free-trade agreement (FTA) with India, effective October 1, the Swiss watch industry is set to gain better access to the expanding middle class there.

This year’s study highlighted India’s strong domestic demand, increasing wealth, and significant investment in retail infrastructure. Similarly, the study pointed out Mexico, where Switzerland had established an FTA in 2021.

Since then, Swiss watch exports to Mexico have surged fivefold, positioning the country as the leading market for Swiss watches in Latin America. Social media trends are significantly fueling the enthusiasm for watches in Mexico.

While Mexico is making strides, India remains the fastest-growing major market for the industry. According to FH data, Swiss watch exports to India rose by 25 percent last year, reaching 274 million francs. Meanwhile, exports to Mexico saw a 16 percent increase, totaling 337 million francs.

Despite the optimistic outlook for growth in these emerging markets, Deloitte cautioned that increasing sales alone will not sufficiently counterbalance the challenges posed by U.S. tariffs and the decline in exports to China. In the previous year, Mexico ranked as the 15th largest market for Swiss watches, while India fell into the 21st spot.