Independents

chintu
504

• Show profile
• Show other posts

A problem compounded

Multiple Factors have compounded the problem

1. Oil prices have hit disastrous levels. Liquidity strains are evident and curtailed spending on the luxury items is inevitable .

2. China is spending lesser and importing less oil +  Chinese austerity measures are biting.

3.Russian rouble is at an all time low and the typical Russian luxury watch collector is no longer an aggressive buyer

4. Eurozone is again threatening to slip back into recession

5. Swiss watchmakers have constantly increased prices without looking at what the market would be prepared to bear in the medium term.

6. Watch supplies have increased and demand has slowed.

7. Greubel Forsey has pushed the envelope too far in terms of pricing, as have been some of the other high profile independents. Look at the pricing of  the most basic models from the following - Richard Mille ( starts US$ 55K; DeBethune - starts $55K except for the Titan Hawk at $40K; MB&F - starts $60K; Urwerk at 60K; not to forget Vianney Halter, Cabestan, Dufour, Voutilainen, Laurent Ferrier et al..

8. Even absolutely new entrants like Moritz Grossman start at 30K for the basic watch.

By and large, the Swiss watch industry is strangulating the golden goose in its anxiety to collect more "eggs" by raising prices when it should be doing the opposite.

IMHO 2015 will see a shake-out reminiscent of 2009/10.

Regds

Site Info.