China’s growing love of luxury watches remains strong, despite economic headwinds

By Leona Liu, CNN

Geneva (CNN) — When the luxury Watches and Wonders fair closed its doors in Geneva earlier this week, it had hosted an estimated 49,000 luxury watch enthusiasts and collectors from around the world, all eager to be inspired by the best new designs and complications.

According to a report by the Federation of the Swiss Watch Industry (FHS), mainland China and Hong Kong combined spent over 5 billion Swiss francs (5.49 billion) on watches in 2023, meaning luxury consumers in greater China are the biggest clients when it comes to the 26.7 billion franc (29.3 billion) watch exports business.

But one region’s visitors stood out among the crowd — 40% of this year’s attendees hailed from Asia according to the event’s CEO Matthieu Humair, with a significant portion coming from China.

Watching your wealth

It’s not surprising. Despite economic challenges looming large — including prolonged downturns in both the housing and stock market — China’s fascination with luxury watches remains undiminished.

In fact, luxury watches are seen by many affluent Chinese as a compelling alternative investment avenue during times of financial uncertainty, when diversifying away from “traditional” investments such as real estate or stocks is seen as prudent.

Certainly at this year’s fair, well-dressed, well-accessorized Chinese customers appeared unfazed by economic uncertainties. Mostly invited by brands, these high-spending VIP guests often pay millions for timepieces or jewelry, either at home in China or during overseas travels.

Accordingly, Chinese brand ambassadors were also front and center at this year’s fair, with appearances by actors such as Jackson Yee at Jaeger Le-Coultre, Zhu Yilong at Chopard and Wang Yang at IWC. Other personalities including actor and singer Xiao Zhan conducted livestream sessions that enthusiasts could tune into.

David Sadigh is CEO of Digital Luxury Group, a digital marketing agency in Europe and China whose clients include Patek Philippe and Van Cleef & Arpels. After more than 20 years working in the region, he believes China’s economic slowdown is just a temporary phase.

“The higher-end price point brands are not concerned (by the downturn),” Sadigh told CNN during an interview at the fair in Geneva. “The situation may be slightly (more) challenging for mid-level luxury brands (whose clients’ disposable incomes are potentially more at the whim of market forces). But I’m confident that in the long run, China will be the biggest market for luxury watches.”

Many executives of the 54 watchmaking brands that CNN spoke to at Watches and Wonders echoed this sentiment, expressing confidence in China’s ongoing passion for luxury timepieces and underscoring the resilience of this market segment amid the broader economic headwinds.

Sales at Hublot, a prominent luxury watch brand in the LVMH stable, have this year rebounded to pre-pandemic levels, although growth rates have slowed compared to the peak of post-pandemic “revenge spending” (a phenomenon whereby customers rush to spend more than they usually would on something after being deprived of the ability to do so) in 2022. Despite commanding price tags sometimes into the millions of yuan, the brand continues to attract discerning consumers, with US and China as its biggest clients.

“It’s understandable that people wait and see how to spend their money when the market is down,” said Hublot CEO Ricardo Guadalupe. “For the Chinese consumers, once they consume, they will come back, because they appreciate luxury watches from the bottom of their heart.”

Indeed, despite being a relatively new market for watchmakers, wealthy Chinese customers are already regarded as discerning clients alongside buyers from more mature markets like Europe and the US, who have long appreciated the artistry, elegance, and craftsmanship in haute horology.

“We’ve seen in Asia — China in particular — average consumers are younger, around 35 (and) have an eye for unusual designs,” said Guadalupe.

Carson Chan, a timepiece expert whose previous titles include General Manager of Richard Mille Asia, Bonhams’ Head of Watches and Chief Advisor of Fondation de la Haute Horlogerie (FHH), is also a collector. “In Asia, where collecting large items like cars can be challenging, watches offer a compact alternative for collectors,” Chan told CNN in an email interview from his home in Hong Kong. “The strong learning culture and understanding of mechanisms in Asia further support a sophisticated market, evidenced by the rise of independent brands across the region,” he added.

Raphael Young, who also lives in Hong Kong and works in financial services in the IT industry, has just returned from the fair in Geneva. “As a watch collector, the five main criteria I look deeply into (are) value, craftsmanship, history, innovation and the people behind the timepieces and the brand,” he told CNN via a phone interview and added; “There is a lot of learning, researching, meetings and almost scholarly pursuits involved in cultivating my collecting hobby.”

Timeless designs

A. Lange & Söhne, a smaller independent watchmaker producing just 5,000 pieces globally, maintains a distinctive niche in the market. The brand’s CEO Wilhelm Schmid also remained unperturbed by China’s economic conditions.

“A. Lange’s customers are real collectors; it’s very niche. Though our price is not low, there are groups of clients whose finances are not affected by the market fluctuations, who just appreciate the best timepieces,” he told CNN in an interview at the event. The house’s new Datograph Perpetual Tourbillon Honeygold Lumen, for example, integrates a flyback chronograph, a jumping minute counter, perpetual calendar with outsized date and a tourbillon with a stop-seconds mechanism.

Some watchmakers appear to be courting Chinese buyers through unique design flourishes and Chan has observed that smaller case sizes are trending.

Eleven years in the making, Vacheron Constantin’s record breaking one-piece-only giant pocket watch The Berkley has been designed to celebrate cultural fusion by combining traditional Chinese lunar calendar functions with Western horological complexities — for example a perpetual calendar, minute repeater, and tourbillon.

“The Berkley features the first Chinese perpetual calendar which, given the particularities of the complex and irregular cycle… is a feat of horological genius,” said Young. “China has the longest continuous history of any country in the world (with) 3,500 years of written history, and it is only now we have a mechanical timepiece for the Chinese perpetual calendar. As a Chinese, I would find it useful and would be very interested in having such a complication.”

Meanwhile, renowned Swiss watchmaker Roger Dubuis created another novelty in celebration of the new Year of the Dragon, on display in Geneva earlier this week. Limited to eight pieces, it is expected to appeal to Chinese collectors and enthusiasts.

Among some of the most popular luxury fashion brands in China — which also include Dior, Louis Vuitton and Gucci — Chanel and Hermes have joined the traditional watchmakers at the fair, expanding beyond fashion watches into the universe of high watchmaking.

Hermès unveiled the Arceau Duc Attelé watch, featuring a sapphire dome top and new minute repeater; and Chanel debuted a 55-piece limited edition Mademoiselle J12 Couture watch featuring a dial adorned with the silhouette of Mademoiselle Chanel in a black and white suit, finished with 46 baguette-cut diamonds.

Unlike volatile financial markets, watches offer tangible value combined with emotional attachment. Collectors appreciate the craftsmanship, rarity, and heritage associated with luxury timepieces, which can hold or increase in value over time.

“In a world where everything is so connected, there’s nothing more beautiful than a wristwatch powered by mechanical movement. It’s timeless, a piece of art, something to pass down to generations.” explained Humair. “We’re very excited to see younger generations in Asia, especially China, show a lot of interest in watchmaking.”

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