China Didn’t Kill Swiss Watches — But It Ended Their Unchallenged Reign
The claim that China has quietly killed the Swiss watch industry is dramatic and overstated. Yet the underlying reality is more interesting and more consequential. Over the past three years, a sharp collapse in Chinese demand, combined with the steady rise of Chinese manufacturing capability and independent brands, has forced the Swiss industry into its most significant structural adjustment since the quartz crisis of the 1970s and 1980s. The industry is still very much alive and generating tens of billions of francs in exports. What has ended is the comfortable assumption that Switzerland’s dominance was permanent and that China would remain a reliable engine of growth.
From Boom to Correction
Swiss watch exports reached record levels in the years immediately after the pandemic. Chinese consumers, both on the mainland and through Hong Kong, played a central role in that boom. For many brands, Greater China accounted for a disproportionate share of sales and profit. Then the music stopped. In 2024, Swiss watch exports fell 2.8 percent. In 2025 they declined another 1.7 percent to 25.6 billion francs overall, with finished watches at 24.4 billion francs. Unit volumes dropped more sharply, falling 4.8 percent to 14.6 million pieces — 740,000 fewer watches than the previous year.
China was the primary culprit. Exports to the mainland fell more than 25 percent in 2024 and another 12.1 percent in 2025, dropping the market to third place behind the United States and Japan. Hong Kong also contracted. The United States has become the largest single destination and has shown greater resilience, while newer markets such as India and Mexico have grown strongly. But none of these gains fully replaced the Chinese shortfall that once powered the industry’s expansion.
Why Chinese Buyers Stepped Back
Several forces converged. China’s broader economic slowdown, particularly the property sector crisis, reduced discretionary spending among the middle and upper-middle classes who had been the volume buyers of mid- and upper-mid Swiss watches. At the same time, official messaging around “common prosperity” and a quieter campaign against ostentatious displays of wealth made highly visible luxury less attractive. The second-hand market expanded rapidly, offering legitimate Rolex, Omega, and Cartier pieces at lower prices. Domestic Chinese brands improved enough that many consumers no longer felt they needed a Swiss name to signal status.
The result was a classic luxury correction that hit hardest in the price bands between a few thousand and roughly 20,000 francs — precisely the territory where many Swiss brands had built volume and brand aspiration in China. The ultra-high end, by contrast, proved more resilient. Watches above 3,000 francs continued to show relatively solid demand even as lower and mid categories contracted.
The Double-Edged Relationship With Chinese Manufacturing
The story is not only about demand. For decades, China has been a critical supplier of components, cases, bracelets, dials, and other parts to the Swiss industry. Many “Swiss Made” watches contain Chinese-made elements that fall within the legal thresholds for the label. This relationship delivered cost efficiency. It also transferred knowledge and industrial capacity.
Chinese factories have steadily raised quality. At the same time, a new generation of independent Chinese brands has emerged with genuine technical and aesthetic ambition. Atelier Wen has earned international respect for its hand-guilloché dials and ambitious material experiments, including full-tantalum pieces. Behrens, founded in Shenzhen, made history in 2026 by becoming the first Chinese independent brand to exhibit at Watches and Wonders Geneva, presenting designs that blend modern engineering with references to ancient Chinese artefacts. These are no longer cheap copies. They are serious competitors in the independent space, often offering higher levels of finishing and originality at more accessible prices than equivalent Swiss pieces.
China already dominates global watch production by volume, shipping hundreds of millions of units annually, mostly at very low average prices. The qualitative leap at the higher end means the country is no longer content to remain only a workshop for Swiss brands or a pure mass-market producer.
Impact Inside Switzerland
The effects have been visible across the Swiss valleys. Swatch Group, more exposed to China and to mid-market brands than some peers, saw its net profit collapse by nearly 90 percent in 2025 to just 25 million francs. Operating margins compressed sharply. Employment in the broader industry declined modestly. Component makers and smaller manufacturers faced reduced orders and, in some cases, short-time work schemes. Richemont’s specialist watchmakers also endured a difficult period, though the group’s overall luxury portfolio, led by Cartier and jewellery, provided a buffer and has shown clearer recovery signs in 2026.
The industry’s response has been classic Swiss pragmatism mixed with necessity. Production has shifted further toward higher average selling prices. Brands have tightened allocation of popular models, protected pricing discipline, and accelerated efforts in the United States, Middle East, India, and other growth markets. The strong Swiss franc and elevated gold prices have added cost pressure, reinforcing the move upmarket. First-half 2026 figures suggest a measure of stabilisation: exports were down only 0.7 percent in value while volumes actually rose slightly, indicating that the worst of the volume collapse may be behind the industry.
A Permanent Shift, Not a Fatal Blow
The Swiss watch industry is not dead. It still commands the majority of global export value in the category. Its best brands retain extraordinary pricing power, heritage, and desirability that Chinese competitors have not yet matched at the very top. The technical ecosystem around mechanical movements, finishing, and complications remains concentrated in Switzerland and a handful of specialised suppliers.
What has changed is the competitive landscape and the growth model. China will likely never again deliver the explosive, multi-year demand surge that Swiss brands enjoyed between roughly 2010 and 2021. At the same time, Chinese manufacturing and design capability will continue to improve. The result is a more contested, more multipolar industry. Swiss companies that cling to old assumptions about automatic Chinese growth or that fail to defend brand equity and innovation will struggle. Those that treat China as both a difficult market and a serious industrial competitor — while aggressively developing other regions — will adapt.
The quartz crisis forced Swiss watchmaking to reinvent itself by consolidating and focusing on mechanical prestige. The China shock is forcing a different kind of reinvention: less dependence on any single market, greater willingness to compete on craftsmanship rather than just origin, and acceptance that the industry’s future growth will be slower and more hard-won. The Swiss watch industry survives. Its era of easy dominance does not.
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