Why US Tariffs Won’t Protect a Non-Existent Watch Industry

Georges Kern, the CEO of Swiss watchmaker Breitling, is seeking a tariff exemption for the watch industry in the United States, according to reporting by NZZ. Kern argues that because the U.S. lacks a significant domestic watch industry, tariffs on imported timepieces do not protect American manufacturers but instead penalize consumers and exporters.

The push for an exemption comes as Swiss watch manufacturers face potential trade barriers that could increase the cost of luxury goods entering the American market. Breitling and other Swiss brands rely heavily on the U.S. as a primary destination for their high-end exports.

Breitling’s Argument Against U.S. Watch Tariffs

Kern’s position is based on the premise that tariffs are typically designed to shield domestic industries from foreign competition. However, he asserts that the U.S. does not possess a comparable industrial base for watchmaking that would benefit from such protectionist measures, according to NZZ.

Because there is no substantial American watch industry to protect, Kern suggests that tariffs on Swiss imports serve no strategic economic purpose for the U.S. government and only create unnecessary financial burdens for the companies and customers involved.

Impact on the Swiss Watch Industry

The Swiss watch industry is highly integrated into global trade, with the United States representing one of its most critical markets. Any increase in import duties would likely lead to higher retail prices for consumers in the U.S. or reduced profit margins for Swiss firms.

Swiss manufacturers are concerned that broad tariff policies could disrupt the flow of luxury goods. By seeking a specific exemption, Kern aims to decouple the watch industry from wider trade disputes or general tariff hikes that might target other sectors where the U.S. does have competing domestic production.