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Strategies that will keep watchmakers busy in 2022

The figures of Q1 2022 are testimonies of the luxury sector’s good health, specifically in watchmaking and jewelry. Hermès has even recorded an exceptional growth of 65% in watch sales. Panerai and Parmigiani Fleurier, two brands with rather opposite business models, confirm this trend. We share our analysis in an uncertain economic context.

Cristina D’Agostino

By Cristina D’Agostino21 avril 2022

Swiss watch exports grew particularly strongly in the first quarter of 2022. In February, they were up by 24% compared to February 2021 (FHH/Keystone/Cyril Zingaro)

+19%

Organic growth in Q1 2022 for watches and jewellery at LVMH

+62%

Hermès watch sales growth in Q1 2022

+22%

Swiss watch exports in February 2022

Transparency, sustainability, blockchain, independence. While these themes have dominated CEOs’ public speeches during the seven-day watchmaking fair of Watches & Wonders, managers had other topics on their mind. The stock-markets’ restlessness, inflation, the war in Ukraine, boutique closures in China due to the pandemic resurfacing and a lack of visibility on component deliveries are themes that led to other preoccupations. Will exceptional performances recorded during Q1 2022 carry on?

The first months are exceptional: to have enough watches is my only concern

Jean-Marc Pontroué, CEO of Panerai

On this point, LVMH, the world leader in luxury, communicated on April 12th about growing sales, +29% vs 2021, 18 billion euros, confirming “a great start to the year in an environment still disrupted by the sanitary crisis and challenged by dramatic events in Ukraine.” Watchmaking and jewelry within the group also managed to achieve organic growth by 19% in sales, to 2.3 billion euros during Q1 2022.

Hublot confirms strong sales growth in the first three months of the year. Here the new Big Bang Automatic Tourbillon model in violet sapphire (DR)

This great performance was confirmed by Ricardo Guadalupe, CEO of the brand Hublot (in the hands of the LVMH group), during Watches & Wonders: “The first three months of the year were extremely positive for Hublot. We are significantly growing vs 2021, an even greater year than 2019 which was already a record year for us. Nevertheless, a certain slow-down in the Chinese market caused by lockdowns forces us to remain cautious. Our four boutiques are closed, the Shanghai population is staying at home. The brand has also stopped operating in Ukraine and Russia, a market which represents 2 to 3% of our sales. We have no visibility for the time being. Luxury is dependent on a psychological effect; we have to keep a positive mindset.” Same observation at Panerai: “2021 has been a record year for Panerai, explains Jean-Marc Pontroué, CEO of the brand. The first months are exceptional: to have enough watches is my only concern.”

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Regarding the Hermès group, which has also communicated its figures for Q1 2022 on April 14th (+27% with a constant exchange rate at 2.76 billion euros), watchmaking at Hermès is at its highest since the beginning of its creation, as it reached +62% end of March, the strongest growth of the group.

Strategies to adopt to maintain growth

Vacheron Constantin reissues its legendary 222 in yellow gold, unveiled in 1977 for the 222nd anniversary of the House (DR)

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