How Apple is set to take a bite out of Swiss watch market
The tech giant has rapidly gained share in the watch market and in 2018 will come close to matching worldwide sales of Swiss-made watches, says CCS Insight
Zurich — The Swiss watch industry faces an increased threat from a new Apple Watch able to detect heart problems, which is likely to appeal to older shoppers, industry experts said on Thursday.
Apple presented the new Apple Watch Series 4, which is able to take an electrocardiogram to detect an irregular heartbeat and start an emergency call automatically if it detects a user falling down.
"Far from just being an evolution, the new Apple Watch 4 is probably a revolution because it does not only target the wrists of geeks but also of people over 45 who care about their health," said industry expert Gregory Pons on his website.
Apple has rapidly gained share in the watch market, with connected technology research firm CCS Insight estimating that the tech giant will in 2018 come close to matching worldwide sales of Swiss-made watches, which had shipments of 24-million units in 2017. Exports of Swiss watches in the entry-price segment — of up to $500 — have steadily declined over the past years, with competition from smartwatches one of the factors responsible.
"The Apple Watch continues to improve and provide additional relevant functions. I think this will represent a harder and harder challenge to entry-price Swiss-made watches, which are not in a position to stay relevant," Exane BNP Paribas analyst Luca Solca said.
Jean-Claude Biver, head of LVMH’s watch division, which makes watches under the Zenith, Hublot and TAG-Heuer brands, said people getting into watches, thanks to an Apple product were more likely to buy a Swiss watch later on.
Richemont shares were up 0.2% at midday, while those of Swatch, which is more exposed to the entry-price segment, were down 0.6%. Shares of fitness device rival Fitbit fell 6.9% after the Series 4 announcement on Wednesday.