• Swiss watch stocks surged following signals that the US is close to reducing the 39% tariff rate to 15%.
  • The potential deal follows a 56% collapse in Swiss watch exports to the US in September, which had diverted trade to other markets.
  • Negotiations are part of a broader US policy to establish reciprocal tariff rates with major trading partners.

Swiss watchmakers are poised for a major reprieve as the United States moves closer to slashing the punishing 39% tariff on their exports, with negotiations advancing to lower the rate to 15%—bringing it in line with the rate faced by the European Union.

The development, signaled publicly by President Trump as "close," triggered an immediate rebound in stocks for major Swiss watchmakers Swatch Group and Richemont in early November trading. The rally reflects market optimism that the steep decline in US sales, which saw Swiss exports to the market collapse by 56% year-on-year in September, may soon be reversed.

According to people familiar with the matter, the framework being discussed would mirror other reciprocal trade agreements the US has recently implemented. The Swiss Department of Economic Affairs has confirmed that negotiations with the US are ongoing, though officials have remained discreet about the specific timeline.

The tariff escalation that began in August sent shockwaves through the Swiss luxury sector. The US had historically been the largest export destination for Swiss timepieces, accounting for 16.8% of total exports in 2024. The subsequent rerouting of exports to markets like the UK and Japan provided only partial relief, creating significant price pressures for both producers and US consumers.

"The market is breathing a sigh of relief, but the real test will be how quickly export volumes can normalize," said one industry analyst who asked not to be named while negotiations are sensitive. The potential for a 15% tariff rate is seen as a critical step toward stabilizing the $3 billion-plus Swiss watch trade with the United States.

Behind the scenes, Swiss billionaires and industry leaders are understood to have played a pivotal role in lobbying US policymakers, highlighting the cross-border economic stakes. The efforts appear to be paying dividends as the administration seeks to maintain positive relations with Switzerland while advancing its broader reciprocal trade policy agenda.

Without a deal, Swiss watchmakers would have faced continued erosion of their most profitable market. The earlier tariff shock had sparked job concerns in Swiss manufacturing hubs and drawn criticism from US politicians, including Senator Elizabeth Warren, who questioned the effectiveness of the policy.

If successfully enacted, the tariff reduction could quickly revive Swiss export volumes and moderate US retail prices, which had jumped following the initial tariff imposition. The development is being closely watched by other luxury goods conglomerates, including France's LVMH, which are navigating parallel discussions and considering strategic supply chain shifts to mitigate tariff risks.

Correction: An earlier version of this article misstated the year of the export collapse. It occurred in September 2025.