Boom or bust?

Watches & Wonders ended with record figures. Attendance surged to 43,000 visitors - nearly double of last year - which logically follows the market trend and its 24.8 billion Swiss francs worth of watch exports in 2022. Good news, which we imagined to be lost forever in the galaxy of the " world of before ". But the world of today, overpowered and fed by pandemic frustration, has overcome the desire for frugality and sobriety expressed by some luxury players, particularly in fashion, barely two years ago. The brands present at the show all spoke of sustainability, but only in relation to their productivity and their industrial strengths. Chopard announced its commitment to purchasing only recycled steel, and Cartier demonstrated its ability to transform factories into clean and autonomous production units. And this is to be applauded. But the model has not changed. The unpredictability of the modern world pushes us to consume, to live the moment in whatever sensational way it still has to offer. And luxury responds perfectly to this impulse.

So the brands are increasing their means of production, pushing back the walls of their factories to bring in the latest robotized machines. This was the leitmotiv of all the bosses encountered in Geneva. Stores will be able to stock up… and soon overstock. For the level of household debt is increasing worldwide in connection with inflation and higher interest rates. There is a greater risk of defaults, particularly in the US, during the fourth quarter of 2022.

Of course, the watch industry, jewelry and fashion are doing everything possible today to verticalize their production, control demands better and respond with a more adapted time to market. If it is difficult to predict what the world will be like in a year's time, it is quite logical to foresee that the boom observed could turn into a bust.