October 22, 2012

Breguet Thinks It Has What It Takes To Weather China’s Luxury Watch Slowdown

Watchmaker Currently Has Five Free-Standing Locations In Mainland China

Breguet now has three locations in Beijing

While other Swiss luxury watchmakers play the waiting game in China, hoping for a significant sales rebound within the country in 2013, Swatch-owned, Vallée de Joux-based Breguet seems confident that demand at the ultra-high-end remains strong. Despite intensified scrutiny among the government in Beijing and eagle-eyed Weibo users alike, Breguet recently chose political power center Beijing to launch two new boutiques in close proximity to one another, the manufacturer’s fourth and fifth free-standing locations in China.

Located at Beijing Yintai Centre (北京银泰中心) and the adjacent Beijing Grand Hyatt, the stores follow Beijing’s first at Scitech Plaza, Shanghai’s Swatch Art Peace Hotel, and Heyi Avenue Shopping Center in Ningbo. To celebrate the opening, earlier this month the watchmaker debuted a new Classique Hora Mundi World timepiece exclusively at the new Beijing locations.

Though demand has slowed over the course of 2012 as luxury watch consumers in China have either cut back or made more purchases abroad, Hong Kong and mainland China have been good for the Swatch Group in recent years. Last year, the group saw Chinese and other emerging market buyers fuel an overall 18 percent sales boost, recording income of 1.27 billion Swiss francs (US$1.4 billion), up from 1.07 billion francs ($1.16 billion) in 2010. Among all Swiss watchmakers, the Greater China region has become an ever more crucial market as demand in traditional markets like North America and Europe has showed sluggish growth. Last year, Greater China accounted for more than half of all Swiss watch exports, which climbed 19 percent to a record 19.3 billion francs (US$20.9 billion).

Breguet Classique Hora Mundi World

In September, however, sales in mainland China and Hong Kong took a 27 percent dive — though, as a Swiss Watch Federation spokesman told the Guardian, part of this drop is counterbalanced by increased buying by tourists in Europe. As with the luxury slowdown that more recently hit major brands like Burberry while leaving Hermès largely unscathed, the luxury watch slowdown in China is far from uniform. Fellow Swatch Group-owned brand Longines is one watchmaker that seems perfectly placed to weather the current state of the China market, owing to its more traditional, smaller and less conspicuous designs. As Longines Chief Executive Walter von Kaenel recently told Reuters, “[Chinese buyers] want classical watches, they want sizes adjusted to their wrist…and at reasonable prices.”

Though its designs are, typically, far more ornate than the more classical Longines, Breguet has been less visible in China than other watchmakers — among them Rolex and Patek Philippe – that have recently come under greater scrutiny among government official-watching bloggers. Like earlier market entrants such as Cartier, which held its “Treasures” exhibition at the Forbidden City in Beijing in 2009, Breguet has attempted to catch on among China’s wealthy by tying itself closely to culture. Earlier this year, Breguet took its “Reine de Naples” traveling exhibition on a China roadshow, stopping by Shanghai, Beijing, Hangzhou, Harbin and Taiyuan.

Business & Finance / Lifestyle / Market Trends / Policy / Watches
Tag: breguet, burberry, china expansion, hermes... , More
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