- The jewelry and timepiece sector expresses discontent over escalating gold costs.
Economic instability due to international conflicts and looming elections in the USA and Germany in the following year are casting a shadow of uncertainty, shared Guido Grohmann, head of the BVSU, the Federal Association of the German Jewellery, Watch, Silverware, and Allied Trades. "The political landscape has been stagnant for quite some time now, with no signs of improvement at the hotspots," he added, indicating that this situation will continue to negatively impact the industry's sentiment, consumer spending, and the overall economy during the second half of the year. Companies must adapt accordingly.
The Industry's Spirits Take a Turn for the Worse
Germany's jewelry exports during the initial six months of 2024 saw a marginal drop of 1.1%, amounting to 1.423 billion euros. Conversely, jewelry imports saw a surge of 3.4%, reaching 1.05 billion euros. In the watch sector, exports of finished products witnessed a rise of 4.9% to 846.8 million euros, while imports dipped by 5.9% to 1.1 billion euros.
As per the data available up to April for the jewelry and watch retail trade, a pattern of volatility rather than a consistent trend can be noticed. Post the spring fairs, retailers have been postponing their purchases of merchandise.
When adjusted for inflation and gold prices, the industry is observing a significant decrease across all sectors. According to the BVSU, in order to match the strong economic years of 2022 and 2023, exports would require a substantial increase in Euros. Anxiety about the economic future is widespread among the BVSU's members, with the overall industry sentiment now significantly deteriorated.
Despite the challenges posed by economic instability, innovative watchmaking companies continue to invest in the Manufacture of watchmaking, maintaining their commitment to high-quality craftsmanship. However, the lingering uncertainty caused by international conflicts and political unrest in key markets like the USA and Germany is impacting their export strategies and profit margins.
