Stepping Out of America's Shadow: How Entry-Level Luxury Swiss Watchmaking Can Bounce Back Against Trump Tariffs
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Since March 2025, Swiss watchmaking has been facing a head-on collision: a 31% customs tariff on its watches bound for the United States, decreed by Donald Trump as part of a trade standoff with several European countries. This is a direct attack on an industry that relies on prestige, tradition, and exports. In terms of value, the United States was the leading market for Swiss watchmaking in 2023, accounting for CHF 4.4 billion, or nearly 17% of exports.
Entry-level luxury brands, those operating between CHF 1,000 and CHF 4,000, are particularly exposed. Their clientele is more sensitive to price increases, their margins are thinner, and their positioning is more competitive against Japanese giants, independent brands, and smartwatches. In this scenario, they cannot absorb a 30% cost increase without commercial consequences. As a result, they must think differently. Market diversification is no longer an option, it is a necessity.
The rest of the world offers numerous opportunities. However, not all are created equal, and not all are growing at the same pace. Here is a comprehensive strategic map of the alternative markets where entry-level luxury Swiss watchmaking can position itself to maintain its global momentum.
I. China and East Asia
For two decades, China single-handedly drove global watch growth. From entry-level to high luxury, it absorbed Swiss volumes with mechanical regularity. Longines, Tissot, and Omega established networks, built partnerships, and aligned their communication with local prestige codes. The results followed: by 2021, mainland China was hot on the heels of the United States as the world's leading market for Swiss watches.
But this momentum has stalled. Starting in 2022, massive lockdowns linked to the zero-Covid policy slowed trade. In 2023, growth rebounded timidly (+7.6%), before falling sharply in 2024, with a drop of more than 25% in Swiss exports to China. The country is going through an economic slowdown, a structural real estate crisis, and a redefinition of its relationship with luxury. Economic patriotism is gaining ground, and the younger generation, while remaining attached to symbols of success, is beginning to value local brands or more discreet products.
For Swiss brands, this means one thing: maintaining a presence, but profoundly adjusting their message. The days of importing unadapted catalogues are over. Marketing must be rethought around localized storytelling, creating specific editions for Chinese culture, and revising price ranges to integrate the new expectations of the urban Chinese consumer, who is less ostentatious but still status-conscious.
Surrounding this giant, Japan, South Korea, Taiwan, and Hong Kong form a high-value secondary ecosystem. Japan is stable and mature, but marked by strong domestic competition (Seiko, Citizen, Grand Seiko) and an aging population. South Korea shows a strong appetite for status-driven luxury, driven by pop culture, but also a very high adoption rate of smartwatches. Taiwan, though smaller, remains a market of connoisseurs and loyal clients. As for Hong Kong, despite political unrest and the structural decline linked to rising consumption in mainland China, it rebounded strongly in 2023, supported by tourism and resale purchases.
In summary, this region remains strategic due to its volume and watchmaking culture. However, it is no longer an automatic expansion ground. Brands will need to defend their market share with precision, anticipation, and a deep local understanding. It is no longer an easy growth driver, but a foundation to be protected intelligently.
II. India
India is transitioning from a potential market to a strategic reality. Long considered difficult to penetrate due to high customs duties (22%), limited distribution structures, and a weak mechanical watch culture, it is now undergoing a historic shift. In 2024, Switzerland signed a free trade agreement with India via EFTA. As a result, tariffs on Swiss watches will gradually disappear by 2030.
This tax relief arrives in an explosive context. India boasts some of the strongest economic growth in the world, between 6% and 7% per year. It has a rapidly rising middle class of over 300 million people with significantly increasing purchasing power. It also possesses massive demographic capital, with half of the population under 30. These young, connected urbanites aspiring to a status-driven lifestyle constitute a new generation of luxury consumers, who are curious, demanding, and eager to express themselves.
For Swiss brands, this is a unique opportunity. Entry-level luxury can expand there through well-established networks like Ethos Watches, but it must be accompanied by an educational effort. India remains a country where mechanical watches are not widely known, and where Switzerland's image as a symbol of precision and tradition must be built or rebuilt.
This market will not work without a genuine long-term strategy. Communication must be localized, campaigns adapted to Indian culture (particularly around weddings, religious celebrations, and professional achievements) must be created, and investments must be made in models inspired by local sensibilities, such as colorful dials, slim cases, and visible complications. It is a ground for investment, not opportunistic exploitation. But the potential is immense. Within ten years, India could become a pillar on par with China or the United States.
III. Southeast Asia
ASEAN represents ten countries, over 700 million people, sustained demographic and economic growth, and a connected urban youth. It is also a territory highly underestimated by watch brands that only see it as mid-tier markets, whereas it constitutes a structuring growth lever when approached globally.
Singapore is its natural hub: wealthy, organized, and already in the global top 10 for Swiss watch imports. But the real surge is coming from its neighbors. Malaysia saw its Swiss imports jump by 26% in 2023. Thailand is experiencing a similar dynamic, with a population highly exposed to Western culture and a long-standing consumer elite. Indonesia, larger but less mature, is beginning to see the emergence of an upper-middle class attracted to accessible high-end products. Vietnam and the Philippines are following a comparable trajectory, with rapid growth and increasing interest in visible social status.
The difficulty here lies in cultural, linguistic, and regulatory fragmentation. It is not a uniform block: each country has its own sensibilities, distributors, and expectations. A regional strategy must therefore be built as a sum of coordinated local actions. This means working with multi-market partners and pooling logistical efforts, while adapting the message to each area: more minimalist in Thailand, more status-focused in Indonesia, and more pop and trendy in the Philippines.
The strength of this region is its ability to generate cumulative volume, with attractive margins thanks to relatively low taxes. For entry-level luxury Swiss brands, ASEAN can quickly represent a flow equivalent to or greater than a single market like Japan, provided it is approached as a complete ecosystem.
IV. The Middle East
The United Arab Emirates, Saudi Arabia, Qatar, and Kuwait have never stopped loving Swiss watches. Here, buying luxury is not just a passion, it is a social code. A watch is worn to display success, status, and refinement. Status is written on the wrist. But it is not Rolex for everyone: entry-level luxury has its place here.
Since 2021, the region has bounced back thanks to the resumption of travel, high oil prices, and a wealthy youth looking to assert their individuality. Brands like TAG Heuer and Longines find a young audience here, less focused on absolute prestige but attracted by aesthetics, mechanics, brand name, and availability.
This market does not work without adaptation. Design is incredibly important: yellow gold models, colorful dials (especially green or burgundy), and limited editions with Arabic calligraphy are highly appreciated. Sales often take place in physical boutiques in very high-end environments (Dubai Mall, The Galleria Al Maryah Island in Abu Dhabi). And local competition does not just come from other brands, but from anything related to status: the watch competes here with cars, sneakers, jewelry, and clothing. Therefore, brands must be both desirable and visible.
This market will never absorb millions of pieces. But in terms of value, it compensates with very high profitability. Above all, it is resilient, as clients are often loyal and highly advised. For entry-level luxury Swiss brands, it is an excellent place to stabilize results during times of crisis on other continents.
If you found this article interesting, you can also discover our article “Trump, Tariffs and Turbulence: Swiss Watchmaking Under the Threat of a Trade War”
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