Mainland has less time for exports of Swiss watches

The Chinese mainland led the decline in Swiss watch exports last month, with a 27.5 percent year-on-year decrease, reflecting the slowdown in economic growth, the Federation of the Swiss Watch Industry says.

Figures from the federation show watch exports from the Alpine nation fell for the first time in the past three years by 2.7 percent year-on-year to 1.73 billion Swiss francs ($1.86 billion).

Watch exports to Hong Kong dropped by 19.9 percent in September compared with the same period last year.

Some Swiss watch manufacturers have also noticed the market risk in China. "A certain weakening in the high-end segment in parts of Greater China" is a negative trend for the future, Swatch Group Ltd, a Swiss manufacturer owning 19 brands, said in its half-year report released in July.

The drop in Swiss watch sales reflects the slowdown in China's economic growth this year, said Yang Qingshan, a guest researcher on luxury goods and services at the University of International Business and Economics in Beijing.

Rich people are the main buyers of luxury watches and their purchasing habits are more likely to be affected by economic growth, he said.

In July, the Chinese government banned government officials from using public funds to buy luxury items. Some business insiders said the ban will change the rapid development of China's luxury watch market.

"The ban will definitely have an adverse effect on luxury watch sales," said Sun Xuguang, operations manager for Sparkle Roll Group Ltd, a Hong Kong- listed luxury dealer in several Swiss independent watch brands, including Parmigiani and DeWitt.

Sun said very high-end brands, manufacturing only hundreds of watches a year, will be affected more, because their products are more conspicuous to the public.

However, Sun said a change in consumer patterns would be the more obvious result of the government's ban, rather than a fall in sales.

"Business owners, rather than government officials, will be the main consumer group for luxury watches in the future, which will be better for the sustained development of the luxury industry," he said.

But the Swiss watch industry federation said the decline will not be a cause for concern, following sales increases for more than 30 months.

The steep decline in China reflects sales figures over several months, with growth clearly losing momentum, the federation said.

Yang, from the University of International Business and Economics, said: "The decline is normal for the market, which touched a peak last year."

Yang said that as a large part of China's entire luxury market, Swiss watches enjoyed a "dream sales performance" in 2011 and this year's decline was no surprise.

The Chinese mainland recorded the highest growth rate of 48.7 percent among the main markets for Swiss watches last year, while Hong Kong also saw a pronounced increase in the same period, the federation said.