Swiss watchmakers at their annual back-to-school gathering in Geneva were putting a brave face on President Donald Trump’s tariffs threatening their businesses. That may change if their U.S. stockpiles run out.

A surge in exports in July should spare watchmakers — at least in the short-term — from bearing the brunt of the 39% levy imposed by the U.S. last month on products from Switzerland, and exhibitors were generally upbeat about Swiss officials’ chances of getting a better deal before their wiggle room runs out. 

“This should be solved, or partially solved in the following weeks or months. So let’s keep being positive,” Breitling AG’s chief executive officer Georges Kern said at the opening of the Geneva Watch Days meeting on September 3. “Everybody has backup plans and some months of inventory just in case.”

The scale of Trump’s tariff on Switzerland, part of his strategy to revitalize U.S. manufacturing, shocked the government in Bern, which had expected a levy similar to the 15% negotiated by the European Union. Instead, exporters like Swatch Group AG and Cartier-owner Compagnie Financière Richemont SA suddenly faced the highest rate imposed by the U.S. on any developed economy.

It comes at a difficult time for luxury watchmakers as geopolitical tensions and record gold prices weigh on demand. The U.S. is the biggest or second-biggest market for most Swiss brands, accounting for about 20% of watch exports worth 2.6 billion Swiss francs ($3.3 billion) in the first half of 2025, according to the Federation of the Swiss Watch Industry.

The response from watchmakers was varied. Grenchen-based Favre Leuba, one of the oldest brands established in 1737, paused plans to enter the U.S. market — part of a strategy to widen its customer base beyond its stronghold in India — as soon as the tariff rate was announced, said chairman Patrik Paul Hoffmann.

“If the tariffs will stay in place longer than just three to four months, the impact will be rather substantial for the Swiss watch industry,” he said.

Others are pushing ahead. ZRC 1904, known for making the first diving watch with a patented crown protection system that creates a watertight seal and prevents accidental flooding, is continuing with a plan to add retailers, which started a few months ago despite the tariffs.

Export Boost

Companies rushing to get stock into the U.S. ahead of the tariffs delivered a shot-in-the-arm to July’s export numbers, which were up 6.9% from a year earlier. Excluding the U.S., though, exports would have dropped 0.9% as shipments to markets like Japan and China underscored the industry’s struggles.

Bloomberg Intelligence expects the downward export trend to resume after the U.S. stockpiling in July and early August.

Still, executives in Geneva, where 66 brands had set up shop in hotel rooms, booths and exhibition spaces to display their products, said much depends on what happens with the tariffs.

Swiss trade negotiators are still working on bringing down the levy. “We are hoping to find a better deal. The difference with Europe is quite shocking,” said Delphine Bachmann, Geneva’s state councilor in charge of the canton’s department of economy and labor.

The Swiss delegation met U.S. officials in Washington on September 5 for more trade talks. In a post on X, Swiss Vice President Guy Parmelin described the meetings with Secretary of Commerce Howard Lutnick, Secretary of the Treasury Scott Bessent and Trade Representative Jamieson Greer as “constructive,” but didn’t provide further details.

I held constructive meetings in Washington with Secretary of Commerce Howard Lutnick, Secretary of the Treasury Scott Bessent & Trade Representative Jamieson Greer. Switzerland sees real opportunity ahead for both countries and is committed to deepening our economic partnership. pic.twitter.com/mJWKvs0dJ5

— Guy Parmelin (@ParmelinG) September 5, 2025

Trump is to be a guest of Rolex at the U.S. Open tennis tournament on September 7. 

Meanwhile Watches of Switzerland Group Plc, the top seller of Rolex watches in the U.K., also gave the industry cause for optimism in spite of the trade friction. Trading had been “consistently strong” particularly in the U.S., it said on September 3, in a financial update that triggered a spike in its shares.

“The general mood in Switzerland is that the situation will improve from what it is today,” chief executive officer Brian Duffy told Bloomberg TV.