Zurich: Swiss watch exports to mainland China surpassed those to Hong Kong for the first time in October as anti-Beijing protests in the city dissipated demand for luxury goods.
Shipments to Hong Kong plunged 30 per cent. It was the first time the city ranked behind mainland China as a landing spot for the products since the Federation of the Swiss Watch Industry began keeping monthly records about 30 years ago.
Hong Kong, which had been the largest destination for Swiss timepieces for about a decade, began slipping behind the US in recent months. As the protests rage on, rich Chinese are increasingly buying timepieces in their home country. The stream of tourists into Hong Kong watch shops has dropped to about a tenth of its former level, according to Alain Lam, finance director at Oriental Watch Holdings Ltd., which sells brands such as Rolex and Piaget at stores in both Hong Kong and on the mainland.
“Even Hong Kong locals are afraid of coming out onto the street,” he said in an interview.
Weakening of the yuan has also reduced the price differential between the mainland and Hong Kong, where watches were once about 20 per cent cheaper. Now the difference is about 10 per cent, Lam said.
The value of shipments to China from Switzerland surged 18 per cent in October to 218 million francs ($220 million), surpassing the 191 million francs sent to Hong Kong.
Globally, Swiss watch exports gained 1.5 per cent in October. Growth in the first 10 months of the year was 2.7 per cent, compared with the industry’s annual pace of 6.3 per cent last year.