Swiss Watch industry Struggles Under the Weight of U.S's Imposed 39% Tariff

The world of Swiss watchmaking was rattled after the United States announced and implemented an unexpected 39% tariff on Swiss imports. This move, initiated in August 2025, comes as a direct blow to the luxury timepiece industry which had already been grappling with a proposed tariff of 31% a few months earlier. The bold decision announced at the Watches and Wonders trade show in Geneva reverberated shockwaves through the industry. Quite unpredictably, the tariff imposed on Switzerland, a country revered for its watchmaking finesse, stands higher compared to the baseline tariffs applied to major watchmaking countries like Russia and the UK at only 10%. Quite ironically, countries like China have received more favorable tariff rates, a fact that has added to the overall unpredictability and uncertainty looming over the tariff discussions.

In the midst of this financial turbulence, a possible respite might lie in the rising trend of pre-owned watch sales. The momentum could unsparingly increase once inventory of already imported new and used Swiss timepieces dwindles. However, a realistic perspective reminds us that future imports will bear the full brunt of the heightened tariff, which would inevitably percolate to retail prices.

Whichever way the negotiation pendulum swings, whether it will lead to brands absorbing the cost, a worldwide price hike to compensate for the US increase, or a cost splitting amongst makers, distributors and retailers, the future holds a testing period for Swiss watchmakers. Especially vital is the fact that the US accounted for 16.8% of total Swiss watch exports in 2024, making it the largest market worldwide for Swiss timepieces. The negotiation journey is still ongoing, and there is hope for a more favorable tariff rate for these timeless pieces of luxury.