Luxury watch conglomerate Swatch Group AG raised prices across a slew of its brands, increasing the cost of the flagship Omega Speedmaster by about 7% in the UK and Europe, according to investment bank Jefferies.
The price of an Omega Speedmaster automatic watch with a moonphase complication in the UK is now £10,600 ($13,060) as of Feb. 1, up 7.1% compared to January last year, Jefferies analysts led by Kathryn Parker said in a report. Prices for the same model rose an average of 6.8% in Italy and 2% in the US.
Increases at Swatch brands including Omega, Longines and Tissot follow a similar move by the top Swiss watchmaker Rolex SA to boost prices by about 2.5% in the UK and Europe in January. Rolex had already raised prices across the continent in the autumn, in an unusual move, to counter rising costs and currency fluctuations caused by a strong US dollar and Swiss franc against a weaker sterling and euro. Rolex usually raises prices just once a year.
The uplift shows Swatch brands believe consumers will accept steeper prices as demand for high-end timepieces stays strong.
Luxury watch brands including Rolex and Omega are ramping up prices in the UK, Japan and South Korea by more than other locations to offset weaker currencies and to prevent price discrepancies across regions and countries, according to the note. For example, the cost of an Omega Seamaster 300 dive watch rose by at least 6.5% in all three countries, compared to more modest uplifts in the US and China.
The price of the hit MoonSwatch, the budget-friendly, bio-plastic Swatch version of the Omega Speedmaster, rose in Korea and Japan by more than 7%. Swatch Group, which sold a million MoonSwatch units last year, did not increase prices in the US, UK and Europe where the popular timepiece sells for about €260 ($283).
A spokesman for Swatch Group declined to comment on the report.
Swatch Chief Executive Nick Hayek told Bloomberg News last week that the company could hit record sales of as much as 9 billion Swiss franc ($9.8 billion) in 2023 as China reopens.
Swiss watch exports hit a record 24.8 billion Swiss francs by value in 2022, rising 11.8% from the year before. Export growth slowed in December to 5.8%. –BLOOMBERG