Luxury watch prices for Americans escalate due to Trump's imposed Swiss tariffs
The Swiss watch industry is grappling with a significant challenge following the imposition of a 39% tariff on Swiss watch imports by the U.S. in August 2025. This tariff, the highest in the developed world, has raised import costs and led to an estimated 12-14% price increase for new Swiss watches in the U.S., posing a threat to mid-tier brands and pushing some consumers toward the pre-owned watch market [1][2][3].
This price hike and added costs have strained an already challenged industry coping with post-pandemic demand shrinkage, a strong Swiss franc, and rising input costs like gold prices. Swiss watchmakers, including giants such as Rolex, Audemars Piguet, Omega, and Vacheron Constantin, face a "highly toxic cocktail" of burdens from tariffs, currency pressures, and material costs [1][2][3].
The tariff-induced increase in retail prices threatens to dampen demand in the U.S., which has been a key growth driver for the industry over the past five years [1][2][3]. Vincent Subilia, head of Geneva's chamber of commerce, stated that the US consumer will unfortunately pay the price of what he labeled an "irrational" US tax policy [4].
Moreover, the tariffs encourage a strategic shift among brands, including expansion into other geographic markets such as the Middle East and Asia and growth in certified pre-owned watch programs. Consumers are increasingly opting for vintage and pre-owned luxury watches at significant premiums to avoid tariff-induced price barriers on new timepieces, reshaping market dynamics and sustainability focus in the luxury segment [3].
The proposed tariffs could lead to increased prices for US consumers, reduced volumes at some brands, and even potential threats to sales due to the proposed tariffs by Donald Trump [5]. The weaker US dollar, down roughly 5% against the Swiss franc since mid-2024, has already made Swiss watches more expensive for American consumers [6].
Swiss manufacturers The Swatch Group, Richemont, and Watches of Switzerland could be significantly affected if tariffs are implemented [7]. Watches of Switzerland plans to bring forward orders and ship stock earlier to beat the tariff changes [8]. Despite the challenges, some companies, like Rolex, are better positioned due to their wealthy customers and waiting lists [9].
Jefferies analysts have warned that the tariffs could lead to reduced volumes at some brands [10]. Oliver Muller, founder of LuxeConsult, said Swiss watchmakers perceive the proposed tariffs as unfair because they are not threatening any US-based industry [11]. In June, Switzerland's watch exports to the US were down 18% compared to the previous year [12].
The proposed tariffs, compounding existing issues, have dealt a severe blow to the Swiss watch industry, which accounted for approximately 16.8% of Swiss watch exports in 2024, worth around US$5.4 billion [13]. The US accounted for the industry's first annual drop since a pandemic rebound in 2020, with Swiss watch exports overall declining by 2.8% to SFr26bn in 2024 [14].
[1] The Wall Street Journal [2] Bloomberg [3] Reuters [4] Reuters [5] CNN Business [6] CNBC [7] The Guardian [8] The Telegraph [9] The New York Times [10] The Financial Times [11] The Financial Times [12] Swiss Watch Export [13] Swiss Watch Export [14] Swiss Watch Export
- The increased prices and added costs due to the tariff on Swiss watch imports have strained the finance of the Swiss watch industry, causing a potential threat to mid-tier brands and pushing consumers towards the pre-owned business market.
- The Strategic shift among Swiss watchmakers involves expansion into other geographic markets, such as the Middle East and Asia, and growth in certified pre-owned watch programs to counter the tariffs and tariff-induced price barriers on new timepieces.
