Oct 18, 2018
Swiss watchmaker Patek Philippe says Chinese demand still rising
Oct 18, 2018
Swiss watchmaker Patek Philippe is seeing good demand across the world, its president told Reuters on Thursday, playing down industry concerns about a potential slowdown in top luxury goods buyer China.
Data earlier in the day showed Swiss watch exports fell 7 percent in September, their first decline since April last year and adding to jitters that have hit luxury goods stocks.
But Patek Philippe, which has been making watches in Geneva since 1839, remains upbeat.
"All of our markets did well this year, we're quite satisfied. An exhibition we organised in the United States boosted the brand there, Europe is also still doing well," Thierry Stern said in an interview at the firm's headquarters.
"Domestic Chinese demand is rising steadily, we sell more watches every month. Not the very complicated pieces because taxes remain high, but the core collections," he added.
Stern said the Chinese were likely buying more at home due to worries about issues such as stricter border controls.
His confidence was underlined by a new 550 million Swiss franc ($554 million) building currently under construction on Patek Philippe's Geneva premises that will house production, service and training activities from next year.
The watch industry is undergoing a period of rapid change, with online sales and monobrand stores replacing traditional retailers.
But Patek Philippe, whose best-selling pieces cost around 35,000 Swiss francs and highly complicated models much more, has no plans to rush onto the internet or to drop its partners.
"Our expertise is in producing watches, we do not have the ambition to control our entire distribution worldwide," said Stern, adding it was risky to have too many proprietary stores or to take the whole distribution process in-house - a strategy recently embraced by rival Audemars Piguet.
Like neighbour Rolex, Patek Philippe is one of the last independent Swiss watch brands in an industry dominated by multi-brand groups such as Swatch and Richemont.
Stern said his company was constantly adding to its 2,450 staff, but would only increase the number of pieces slowly, by 1-3 percent per year, from the 60,000 planned for 2018, to maintain quality and exclusivity.
Asked about the Baselworld watch fair, recently shaken by the departure of several brands, Stern said it remained an important platform for Patek to meet retailers and journalists. "But the dates need to be aligned with the Geneva watch fair, that is key to the show's future success," he said.
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