The luxury watch world isn't used to panic, but Georges Kern is sounding the alarm. The Breitling CEO recently labeled Donald Trump’s proposed 39% tariffs on Swiss goods "horrible," and he's not exaggerating for effect. If these trade barriers actually land, the ripple effects will go far beyond a few extra bucks at the jewelry counter. It fundamentally threatens the delicate ecosystem of Swiss manufacturing and the American collectors who keep it alive.
We’re talking about a potential tax hike that could effectively price mid-range luxury right out of the market. While a billionaire might not blink at a price jump on a Patek Philippe, the "entry-level" luxury buyer—the person saving up for their first Navitimer or Chronomat—is going to hit a wall.
The Math Behind the 39 Percent Problem
A 39% tariff isn't just a 39% price increase. It’s a massive logistical and financial burden that compounds as it moves down the supply chain. When you import a $5,000 watch and have to pay an extra $1,950 at the border, that’s just the start. The retailer still needs to make their margin. The marketing budget still needs to be met. The end result? That $5,000 watch becomes a $7,500 watch overnight.
Breitling isn’t alone in this. Almost every major Swiss brand—from Rolex to Omega—would face the same nightmare. The United States is currently the biggest market for Swiss watches. We’re not talking about a tiny niche here. If the U.S. market takes a hit, the entire Swiss industry feels it. Swiss exports reached a record 26.7 billion francs in 2023, and a huge chunk of that was fueled by American demand. If you choke that demand with a massive tax, production lines in the Jura Mountains will start to slow down.
Why Switzerland Is an Easy Target
Switzerland is a small country with a massive trade surplus with the U.S. This makes it an easy target for "America First" trade policies. The logic is simple: if you sell more to us than we sell to you, we’re going to tax you until things even out. But watches aren't cars. You can’t just move a Rolex factory to South Carolina to avoid a tariff. The "Swiss Made" label is the entire product. Without the heritage of the Swiss valleys, the value of the watch disappears.
People pay for the history. They pay for the master watchmakers who spent decades learning how to assemble a movement. You can't replicate that in a factory in the Midwest. This puts Swiss brands in a corner. They either eat the cost and see their profits vanish, or they pass it on to you, the consumer. Georges Kern has been very clear that Breitling doesn’t want to do either.
The Luxury Watch Market in 2026
The market is already feeling a bit of a hangover from the 2021-2022 boom. Prices on the secondary market have stabilized, and the crazy waitlists for "hype" watches have started to shorten. Into this cooling market, Trump’s tariff proposal acts like a bucket of ice water.
Mid Tier Brands Face the Most Risk
The most vulnerable brands aren't the ones selling $100,000 tourbillons. The real damage happens in the $3,000 to $10,000 range. This is where Breitling, Tudor, and Longines live. This is the heart of the luxury market for most professional Americans.
- Breitling: Their aviation heritage appeals to a wide range of buyers, but price sensitivity is real here.
- Rolex: They might be "tariff proof" because of their insane brand power, but even they have limits.
- Tudor: Often seen as the "value" alternative to Rolex, a 39% tariff would destroy their value proposition.
If you’re thinking about buying a watch, this is where it gets tricky. Do you buy now before the rules change? Or do you wait and hope the political rhetoric doesn’t turn into reality?
What This Means for Your Collection
If you're a collector, you're looking at a two-headed monster. First, the retail prices for new watches will skyrocket. Second, the value of the watches already in your collection will likely go up as well. If a new Submariner costs $14,000 because of tariffs, a used one for $11,000 suddenly looks like a steal.
We saw something similar happen during previous trade tensions. Whenever there’s uncertainty about supply or pricing, the secondary market goes nuts. But this isn't necessarily good for the hobby. It makes it harder for new people to get into watches. It turns a passion into a purely speculative asset class, which honestly ruins the fun for most of us.
The Problem with Swiss Neutrality
Switzerland usually tries to stay out of global scraps. But when the U.S. starts talking about 39% tariffs, neutrality isn't a shield. The Swiss government will have to decide how to respond. Will they retaliate with their own tariffs on American goods? If they do, expect prices for American-made tech and machinery in Switzerland to go up. It’s a cycle where everyone loses.
Kern’s comments show a shift in how CEOs are talking about politics. They’re not being quiet anymore. They can’t afford to be. When the stakes are this high, "wait and see" isn't a strategy. They’re lobbying hard, trying to explain that a tax on watches is basically a tax on American success stories. After all, who’s buying these watches? It’s the entrepreneurs, the doctors, and the pilots who form the backbone of the economy.
Action Steps for Watch Buyers
If you're sitting on the fence about a purchase, here’s how to handle the next few months:
- Buy the classics now: If you’ve been eyeing a Speedmaster or a Navitimer, don't wait. Even if the tariffs don't hit 39%, prices rarely go down in the luxury world.
- Watch the secondary market: Keep a close eye on Chrono24 and eBay. If tariff talk intensifies, you’ll see listings start to creep up in price as sellers anticipate the shift.
- Consider independent brands: Some smaller independents might find creative ways to handle distribution, though they’re still subject to the same import laws.
- Talk to your AD: Your authorized dealer knows as much as we do, but they’ll be the first to get the memo on price increases. Get on their good side now.
The luxury market thrives on stability and predictability. Trump’s trade proposals are the exact opposite of that. While the political theater plays out in Washington, the watchmakers in Grenchen and Geneva are left wondering if their biggest market is about to become a luxury desert. Georges Kern is right to be worried. We all should be.
Stop waiting for the "perfect" time to buy. If the history of the watch industry has taught us anything, it's that "yesterday" was the best time to buy, and "today" is the second best. The 39% threat is real enough that you shouldn't gamble with your collection's future. Keep your eyes on the news, but keep your wallet ready. The luxury landscape is about to get a lot more expensive.
