This article is a current news article that links luxury watches to current events. The images and content of the article were initially created using AI and then rewritten by an editor. *This article was created as of August 6, 2025. Tariff negotiations between the US and Switzerland are ongoing, so please check back for the latest information.

What will happen to watch prices after the 39% tariff shock?

"I'm planning to travel to the United States next month. Would it be better to buy my coveted Swiss luxury watch locally?" Some of you may be wondering this. The punitive 39% tariffs on Swiss goods announced on August 4, 2025, have shocked the industry, with estimates suggesting that retail prices in the United States could rise by up to 14%. The punitive tariffs are said to be due to the fact that Switzerland is the 13th largest trade deficit country with the United States. This article delves into the impact and future options.

A buzz inside a luxury watch boutique following reports of a 39% US tariff

*This is an AI-generated image.

What is Trump's "39% tariff"? ──Background and overall picture

President Trump announced that he would impose a uniform 39% tariff on Swiss products on August 7th, citing the International Emergency Economic Powers Act (IEEPA) . This is significantly higher than the 15% tariff imposed on the EU, Japan, and South Korea, and there was almost no room for prior consultation with the Swiss side.

Almost all items are subject to the ban, including watches, medicines, and machinery.
The expected effective date is August 7, 2025
The impact is equivalent to approximately CHF 8 billion per year in terms of US import value

Infographic-style image of the 39% tariff

*This is an AI-generated image.

US retail prices could rise by up to 14% – scenario analysis

Bloomberg points out that the triple cost of manufacturer's shipping price, tariffs, and state taxes could cause retail prices in the US to rise by up to 14%. Reliance on the US market, which has compensated for the slowdown in Chinese demand, has reached 16.8% of total exports, meaning sales of approximately CHF 4.4 billion will be hit directly.

Image of price tags increasing by 14% at US watch stores

*This is an AI-generated image.

Manufacturers and financial market reactions

On the 4th, European stock markets saw Richemont shares fall by as much as 3.4%, Swatch shares fall by nearly 5% , and the Swiss stock index SMI fell to its lowest level in three months. Swatch CEO Nick Hayek expressed optimism, saying " It's not doomsday ," and commented that the company has secured three to six months' worth of inventory in the United States.

brand	Stock price decline rate	US sales ratio	Short-term measures
Richemont	-3.4%	<10%	Consider suspending shipments
Swatch Group	-5.0%	18%	Inventory buildup/price transfer

Image of the stock market crash contrasted with the press conference

*This is an AI-generated image.

How does it work? How to deal with "price fluctuation risk"

For students and new members of the workforce who are thinking about purchasing their first luxury watch, the news that tariffs mean immediate price hikes is likely a cause for concern. However, domestic Japanese prices have a buffer due to exchange rates and inventory levels, so they may not rise dramatically in the short term.

Reconsider your purchase plans for your US trip
Domestic authorized stores and parallel stores regularly check the trends of models with low stock
Don't take out unreasonable loans or buy with the intention of reselling. Be prudent when price movements are unpredictable.

Image of a beginner struggling with pricing apps

*This is an AI-generated image.

A must-read for collectors! ── Understanding the value fluctuations of rare models

Limited edition models with a strong heritage and discontinued products tend to be supported by their rarity premium even under the impact of tariffs. On the other hand, current entry- to mid-range models are more likely to be directly affected by price increases and may be less liquid, so it may be best to be aware of this.

"Do you want a vintage Rolex? The tariffs might just be the catalyst for you to buy one."

Negotiations and short-, medium-, and long-term scenarios

The Swiss government has decided to send the president and vice president to the United States at short notice. They plan to prepare new proposals for easing tariffs and improving relations , and to begin negotiations. If the negotiations become difficult:

Short term : Prices remain stable as inventory is consumed, and stock prices fluctuate wildly
Mid-term : Manufacturers curb shipments to North America, tightening the US used car market
Long-term : Consideration of diversifying suppliers and assembling in the US, FTA renegotiation scenario

Illustration showing short-, medium- and long-term scenarios

*This is an AI-generated image.

Summary: Whether to "act now" or "wait" depends on your strategy

Although the impact of the 39% tariff is significant, the market appears to be waiting for the outcome of negotiations, so gathering information and calmly conducting a thorough analysis are essential. Be careful about the timing of your purchase, carefully assess rarity, and check boutiques, parallel shops, and the second-hand market.

FAQ

Q1. When will the tariffs be officially applied?

It is scheduled to come into effect on August 7, 2025.

Q2. Does the 39% tariff apply to all Swiss watches?

Almost all items are subject to the law, but some exclusions, such as for medical use, are under consideration.

Q3. Will the selling prices in Japan increase soon?

There may be a delay in the impact depending on exchange rates and inventory levels, but it is not guaranteed that prices will increase immediately.

Q4. What are the benefits for beginners to buy now?

There is a short-term benefit in that there is ample domestic inventory and you can choose models before the price change.

Q5. What should collectors pay attention to?

In addition to the authenticity and condition of rare models, carefully consider how rising import costs will affect resale prices.

Source

Bloomberg: Trump tariffs of 39% on Swiss watches could raise prices by up to 14% in the US
Bloomberg: Investors wary of Swiss stock market reopening on the 4th due to 39% US tariffs
Reuters "Swiss luxury watchmakers drop after Trump tariff shock"
Reuters "Swatch CEO hopes for US-Swiss trade deal: 'It's not doomsday'"
Bloomberg with TBS: "Trump imposes 39% tariffs on Swiss watches"