China’s share of the global luxury goods market is likely to have halved this year, according to a report by Bloomberg Intelligence, leaving luxury watchmakers scrabbling to adjust global distribution to faster growing markets like the United States.
However, with signs that China may be winding down its strict zero covid policies, there is potential for significant growth within the People’s Republic and Hong Kong.
Bloomberg says that, among luxury brands operating in China, watchmakers held up better than most.
Swiss watch exports for the first nine months of this year fell by 12.3% for China and by 10.4% for Hong Kong.
Exports to the United States grew by 28.5% over the same period. Those exports total CHF 2.8 billion for the year to September, not far short of the combined total for Hong Kong and China of CHF 3.3 billion.
This compares to 2019, the last full year before the pandemic, when Swiss watch exports to China and Hong Kong totalled CHF 3.7 billion while exports to the United States were worth CHF 2.4 billion.
China’s growth next year is dependent on store re-openings and continuing relaxation of zero covid policies.
