NextFin news, Swiss luxury watchmakers have experienced a notable rise in their stock prices on November 12, 2025, following an optimistic signal from U.S. President Donald Trump regarding efforts to reduce tariffs on Swiss exports to the United States. The shares of Compagnie Financière Richemont SA and Swatch Group AG climbed on renewed market optimism after Trump announced ongoing negotiations aimed at lowering the prohibitive 39% tariff imposed on Swiss watches since August 2025. The U.S, which accounts for approximately 19% of total Swiss watch exports, represents the single largest consumer base for these esteemed brands. The tariff rates applied since July 2025 have been among the highest levied in Trump's global trade realignment, severely impacting Swiss exporters.
Specifically, Swatch, known for labels such as Omega, Tissot, and Longines, saw its shares rise 4.2% during early trading, while Richemont, owner of luxury names like Cartier, IWC, and Piaget, posted a 2% increase. President Trump stated, "We’re working on a deal to get their tariffs a little bit lower," without specifying a numerical target. However, reports suggest the anticipated tariff reduction aims to bring duties down to around 15%. The Swiss government has maintained discretion, declining immediate comment on negotiations rumored to be nearing conclusion.
The tariff imposition had significantly strained profitability and pricing strategies of Swiss luxury watchmakers, provoking concerns over heightened retail prices alienating American consumers. Analysts, including those at Zuercher Kantonalbank and brokerage Kepler Cheuvreux, argue a reduced tariff rate would alleviate margin pressures and potentially restore more competitive pricing dynamics. Jon Cox, an analyst at Kepler Cheuvreux, remarked that the steep tariffs forced price hikes likely to shift demand away from Swiss-made products either through cross-border shopping or substitution by less heavily taxed alternatives manufactured outside Switzerland.
Richemont’s 21% sales exposure to the U.S. and Swatch’s approximately 15% highlight their significant reliance on American market conditions. Furthermore, Swatch exhibits higher vulnerability due to most of its exports originating directly from Switzerland, thereby fully subject to U.S. tariffs, whereas Richemont's diversified European manufacturing footprint partially mitigates tariff impact.
This tariff development is set against the backdrop of the Trump administration’s ongoing protectionist trade policy, characterized by aggressive tariff strategies aimed at trade balance adjustment and domestic industry protection since his inauguration in January 2025. The Swiss case appears to be an early example of tactical tariff recalibration potentially accommodating strategic bilateral trade relationships.
From a strategic industry viewpoint, the tariff reduction could rejuvenate the Swiss watch segment, which is a critical pillar of Switzerland’s export economy — contributing roughly CHF 21 billion annually and symbolizing luxury craftsmanship globally. Easing tariff burdens paves the way for better revenue outlooks, potentially fueling investment in brand innovation and global marketing campaigns tailored for the U.S. luxury consumer base.
Looking ahead, a successful deal could serve as a model for other impacted sectors facing similar tariff-induced profitability challenges. It could also signal a broader shift in U.S. trade policy under President Trump, where initial tariff implementations give way to negotiated adjustments based on economic diplomacy and stakeholder pressure.
However, the negotiation dynamics remain fluid, and definitive implementation timelines and concrete tariff figures are awaited to fully gauge market impacts. Swiss watch companies are cautiously optimistic but have refrained from official commentary pending final deal confirmation.
In conclusion, easing of the 39% tariffs on Swiss watch exports to a proposed 15% level would significantly reduce cost pressures on key luxury brands, restore competitive parity in the U.S. market, and potentially boost industry-wide recovery amid global trade tensions. This development exemplifies how tariff policies beyond initial imposition can evolve through diplomatic engagement to balance protectionist objectives with economic realities faced by exporters.
The Swiss watchmakers’ share price surge on November 12, 2025, thus reflects broad investor confidence in renewed trade cooperation between Switzerland and the United States under the administration of President Donald Trump.
According to ET BrandEquity, market analysts and companies await the finalization of the tariff adjustment, closely monitoring the negotiations between U.S. and Swiss officials for indications of a formal agreement imminent before the year-end.
Explore more exclusive insights at nextfin.ai.