Tariff imposed and Watch Prices in the USA

[Dhiren]

Interesting developments

The U.S. government’s recent decision to impose a 31% tariff on Swiss imports, including watches, is poised to significantly impact both the U.S. market and global watch availability. 

Impact on U.S. Watch Prices and the Grey Market:
•Increased Retail Prices: Importers and retailers may pass the tariff costs onto consumers, leading to higher prices for Swiss watches in the U.S. For instance, a $10,000 watch could see its price rise to $13,100, reflecting the added tariff burden. 
•Expansion of the Grey Market: Elevated retail prices might drive consumers toward the grey market, where watches are often sold at discounted rates. This shift could lead to an influx of Swiss watches in the grey market, potentially undermining official retail pricing and affecting authorized dealers’ sales. 

Effect on Global Availability of Sought-After Watches:
•Diversion of Supply: With the U.S. market becoming less accessible due to higher prices, excess inventory may be redirected to other regions, potentially saturating markets that were previously balanced.
•Price Fluctuations: An influx of watches into markets like India and Mexico, which have shown significant growth in Swiss watch imports, could lead to price adjustments. For example, India experienced a 25% increase in Swiss watch imports in 2024, indicating a trend that might be influenced by global supply shifts. 
•Impact on the Grey Market Worldwide: As official channels face higher prices, the global grey market for Swiss watches could expand, offering discounted prices but potentially affecting brand value perceptions and after-sales support.

In summary, the new U.S. tariff on Swiss watches is likely to lead to higher retail prices in the U.S., potentially boosting grey market activities. This shift could disrupt traditional pricing structures and affect the availability of sought-after watches across global markets.


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[harvey]

Watches of Switzerland share price down 14% today.

[Onami]

Tarrifs are applied to the wholesale transfer price - not the retail selling price.

[alllexandru]

Originally Posted by Onami

Tarrifs are applied to the wholesale transfer price - not the retail selling price.

Yes, you imported with 1 and resale was 1.5
Now you will import with 1+ 0.31 total of 1.31 and you will not gonna sell for the same 1.5 because your operațional margin has to cover the expenseses and profit
So the retail will increase also maybe not with 31% but with a big part of it.
No one is doing charity these days, consumers will pay the difference
Short term and long term it is not sustainable because inflation etc but maybe Rolex will open a factory in us then you will be safe

Very interesting the calculation method used to blow these tariffs in front of the consumers

Matching countries’ tariffs dollar for dollar is an incredibly difficult task, involving poring over each country’s tariff schedule and matching a complex array of products, each of which has a different charge for any variants.

Instead, the government seems to have used quite a simple calculation: the country’s trade deficit divided by its exports to the United States times 1/2. That’s it.

[Ferrari308]

At the same time, you have to recognize that tariffs are imposed heavily on any US made products that are exported. The US has applied no tariffs on anything in the post WW2 era. So, we in the US have allowed this for nearly 80 years.

The US is only doing reciprocal tariffs. This means that if any country is charging tariffs on our goods (which is almost anything & everything that we export), then we will apply the same tariffs on goods from that country.

It's intending to turn the market into a true FREE market and have the US companies have a level playing field with foreign markets.

You might notice that Canada has agreed to eliminate all tariffs with the US rather than to have to charge them. That came pretty quickly. Who is going to be next to drop their tariffs against the US? I am genuinely curious.


PDG

[hojlund]

Originally Posted by Ferrari308

At the same time, you have to recognize that tariffs are imposed heavily on any US made products that are exported. The US has applied no tariffs on anything in the post WW2 era. So, we in the US have allowed this for nearly 80 years.

The US is only doing reciprocal tariffs. This means that if any country is charging tariffs on our goods (which is almost anything & everything that we export), then we will apply the same tariffs on goods from that country.

It's intending to turn the market into a true FREE market and have the US companies have a level playing field with foreign markets.

You might notice that Canada has agreed to eliminate all tariffs with the US rather than to have to charge them. That came pretty quickly. Who is going to be next to drop their tariffs against the US? I am genuinely curious.


PDG

no one will.

[DLRIDES]

Originally Posted by Ferrari308

At the same time, you have to recognize that tariffs are imposed heavily on any US made products that are exported. The US has applied no tariffs on anything in the post WW2 era. So, we in the US have allowed this for nearly 80 years.

The US is only doing reciprocal tariffs. This means that if any country is charging tariffs on our goods (which is almost anything & everything that we export), then we will apply the same tariffs on goods from that country.

It's intending to turn the market into a true FREE market and have the US companies have a level playing field with foreign markets.

You might notice that Canada has agreed to eliminate all tariffs with the US rather than to have to charge them. That came pretty quickly. Who is going to be next to drop their tariffs against the US? I am genuinely curious.


PDG

/\ This /\

[brandrea]

Originally Posted by Ferrari308

At the same time, you have to recognize that tariffs are imposed heavily on any US made products that are exported. The US has applied no tariffs on anything in the post WW2 era. So, we in the US have allowed this for nearly 80 years.

The US is only doing reciprocal tariffs. This means that if any country is charging tariffs on our goods (which is almost anything & everything that we export), then we will apply the same tariffs on goods from that country.

It's intending to turn the market into a true FREE market and have the US companies have a level playing field with foreign markets.

You might notice that Canada has agreed to eliminate all tariffs with the US rather than to have to charge them. That came pretty quickly. Who is going to be next to drop their tariffs against the US? I am genuinely curious.


PDG

I believe the book is still open on that one.

WCS oil is sold at a discounted price to the US.

If you strip out oil, the US would run a trade surplus with Canada.

My comments here are not intended to be political but rather to provide facts.

[watchnoob]

Originally Posted by Ferrari308

At the same time, you have to recognize that tariffs are imposed heavily on any US made products that are exported. The US has applied no tariffs on anything in the post WW2 era. So, we in the US have allowed this for nearly 80 years.

The US is only doing reciprocal tariffs. This means that if any country is charging tariffs on our goods (which is almost anything & everything that we export), then we will apply the same tariffs on goods from that country.

It's intending to turn the market into a true FREE market and have the US companies have a level playing field with foreign markets.

You might notice that Canada has agreed to eliminate all tariffs with the US rather than to have to charge them. That came pretty quickly. Who is going to be next to drop their tariffs against the US? I am genuinely curious.


PDG

LOL - you've been listening to the political soundbites too much from Fox News. Switzerland actually has low tariffs. The 60+% number is based on the trade deficit-not the tariffs. I encourage you to dig deeper into the data/studies, instead of relying on political soundbites from the administration/Fox news.

[joli160]

In my country we import more from the US than we export.
We should get a deduction on tariffs but instead we are hit with a 20% charge

[erling]

Originally Posted by watchnoob

LOL - you've been listening to the political soundbites too much from Fox News. Switzerland actually has low tariffs. The 60+% number is based on the trade deficit-not the tariffs. I encourage you to dig deeper into the data/studies, instead of relying on political soundbites from the administration/Fox news.

[ndirish2001]

Originally Posted by watchnoob

LOL - you've been listening to the political soundbites too much from Fox News. Switzerland actually has low tariffs. The 60+% number is based on the trade deficit-not the tariffs. I encourage you to dig deeper into the data/studies, instead of relying on political soundbites from the administration/Fox news.

Amen. There are so many flat out wrong statements in that post that it’s difficult to know where to start.

[Onami]

[QUOTE=

You might notice that Canada has agreed to eliminate all tariffs with the US rather than to have to charge them. That came pretty quickly. Who is going to be next to drop their tariffs against the US? I am genuinely curious.


LOL! Canada hasn't agreed to eliminating tariffs based on these latest actions. In fact, we have implemented counter-tariffs and are preparing to implement more. And yes, I live in Canada.

[Maleg]

Originally Posted by Ferrari308

At the same time, you have to recognize that tariffs are imposed heavily on any US made products that are exported. The US has applied no tariffs on anything in the post WW2 era. So, we in the US have allowed this for nearly 80 years.

The US is only doing reciprocal tariffs. This means that if any country is charging tariffs on our goods (which is almost anything & everything that we export), then we will apply the same tariffs on goods from that country.

It's intending to turn the market into a true FREE market and have the US companies have a level playing field with foreign markets.

You might notice that Canada has agreed to eliminate all tariffs with the US rather than to have to charge them. That came pretty quickly. Who is going to be next to drop their tariffs against the US? I am genuinely curious.


PDG

Interesting argument.

Realistically, the US never imposed reciprocal tariffs because we like our citizens to be able to buy cheap goods. John Q Public US resident benefits directly by not paying high import taxes on every thing he buys. Low tariffs fuel the consumer economy.

US manufacturing moved overseas to avoid regulatory impacts and higher labor costs. But we still have affordable goods because we don't tax the bejesus out of everything that imports to us from everywhere we exported manufacturing. We don't really care about a trade deficit as long as we can buy cheap goods and stretch our dollar further.

Now we'll add a layer of new taxes universally across the board instead of targeting individual sectors that need strategic help to compete globally. How will that work out? It's a regressive tax. It will work out badly for the center of the bell curve, which will reflect in a sea change in 2026.

[Miker86]

Originally Posted by G23

Its going to be a real shame that the masses will just have to learn that their days of mass consumption of ultra cheap, poorly made goods is over. Just think of the poor landfills that will have to sit empty or the rivers in China that will have to go without being filled with toxic production waste. Such a shame !

The mental gymnastics to position rising prices as a good thing is impressive.

[BradSomrak]

Originally Posted by Miker86

The mental gymnastics to position rising prices as a good thing is impressive.

It almost makes your head hurt trying to get there.

[G23]

Originally Posted by Miker86

The mental gymnastics to position rising prices as a good thing is impressive.

I, for one, have been oh so tired of buying cheap quality garbage. Hey, its cheap though ! I can fill my whole house with cardboard tier finery. Its sad this will end.

[Rolexatlast]

Originally Posted by Miker86

The mental gymnastics to position rising prices as a good thing is impressive.

I’ve seen plenty of threads on here claiming that the grey market sucking up in demand models and selling them onto the public at much higher prices is a good thing

[Maleg]

Originally Posted by G23

Its going to be a real shame that the masses will just have to learn that their days of mass consumption of ultra cheap, poorly made goods is over. Just think of the poor landfills that will have to sit empty or the rivers in China that will have to go without being filled with toxic production waste. Such a shame !

You should change your handle to Marie Antoinette, she had a similar view of the masses.

Tariffs work when applied to commodities that are produced in the US already and need strategic support to flourish globally. Raising the tax rate on every single good imported into the US without regard to whether there is an existing manufacturing capability is a mindlessly idiotic idea.

[SS Oyster]

Originally Posted by Maleg

Interesting argument.

Realistically, the US never imposed reciprocal tariffs because we like our citizens to be able to buy cheap goods. John Q Public US resident benefits directly by not paying high import taxes on every thing he buys. Low tariffs fuel the consumer economy.

US manufacturing moved overseas to avoid regulatory impacts and higher labor costs. But we still have affordable goods because we don't tax the bejesus out of everything that imports to us from everywhere we exported manufacturing. We don't really care about a trade deficit as long as we can buy cheap goods and stretch our dollar further.

Now we'll add a layer of new taxes universally across the board instead of targeting individual sectors that need strategic help to compete globally. How will that work out? It's a regressive tax. It will work out badly for the center of the bell curve, which will reflect in a sea change in 2026.

Do you not understand that the strength of a country does not rely on how cheap something is for the consumer? Why do we need to buy cheap things? Because we can't afford to pay more because we LOST OUR MANUFACTURING JOBS! We have a gig economy, where Uber drivers can only afford a $350 television from Walmart made in China. What is that drive instead worked a $75/hour manufacturing foreman job making televisions? Well, that's not possible, because TVs made in the US would: (1) have to compete with TVs made in China with no tariff and cheap labor, and (2) can't sell in China because US televisions get tariffed to raise their price relative to TVs made in China.

In the meantime, if we cannot get televisions it's a national security risk to not have any TVs made in the USA, which is 100% the case right now. This is proven out by the House Select Committee on the Chinese Communist Party (CCP) letter to Defense Secretary Austin in September 2024. See for yourself here --> https://selectcommitteeontheccp.hous...anies%2C%20BOE

[Roger Lococco]

Originally Posted by Ferrari308

At the same time, you have to recognize that tariffs are imposed heavily on any US made products that are exported. The US has applied no tariffs on anything in the post WW2 era. So, we in the US have allowed this for nearly 80 years.

The US is only doing reciprocal tariffs. This means that if any country is charging tariffs on our goods (which is almost anything & everything that we export), then we will apply the same tariffs on goods from that country.

It's intending to turn the market into a true FREE market and have the US companies have a level playing field with foreign markets.

You might notice that Canada has agreed to eliminate all tariffs with the US rather than to have to charge them. That came pretty quickly. Who is going to be next to drop their tariffs against the US? I am genuinely curious.


PDG

One issue is that the tariffs are not actually reciprocal.


Sent from my iPhone using Tapatalk

[Rudiologe]

Originally Posted by Ferrari308

At the same time, you have to recognize that tariffs are imposed heavily on any US made products that are exported. The US has applied no tariffs on anything in the post WW2 era. So, we in the US have allowed this for nearly 80 years.

The US is only doing reciprocal tariffs.


PDG

That is untrue, where did you get this from? The amount of tarifs up until today was actually calculated. If you take the EU as an example, it has charged goods imported from the US with 2,5 percent tarifs on average. The US charged goods imported from the EU with 2 percent on average. So yes, there is a slight difference, but that is to be expected with complex matters like this. Both the US and the EU profited greatly from this. At least up until now.

[golftime]

Originally Posted by Rudiologe

That is untrue, where did you get this from? The amount of tarifs up until today was actually calculated. If you take the EU as an example, it has charged goods imported from the US with 2,5 percent tarifs on average. The US charged goods imported from the EU with 2 percent on average. So yes, there is a slight difference, but that is to be expected with complex matters like this. Both the US and the EU profited greatly from this. At least up until now.

I confess my limited knowledge of what seems like a very confusing topic, however my understanding is that most European countries have a Value Added Tax (VAT) that goes to the residence government and generally runs about 20%. Is this not the same as a tariff?

[ndirish2001]

Originally Posted by golftime

I confess my limited knowledge of what seems like a very confusing topic, however my understanding is that most European countries have a Value Added Tax (VAT) that goes to the residence government and generally runs about 20%. Is this not the same as a tariff?

No. VAT is the equivalent of a sales tax, in that it doesn’t matter where the product was made.

[golftime]

Originally Posted by watchnoob

That is applied to all goods regardless of country of origination, including goods produced in their own country. How is this the same? It's akin to saying that the sales tax we impose is a tariff on imported goods.

I am genuinely confused how so many people in here are misinformed and regurgitating soundbites from the administration or Fox News. I guess the demographics for Rolex aficionados are not as intelligent as I had thought.

To imply I obtained this information from Fox News or the Administration is not only incorrect but implies a political agenda which is not correct. I admitted my lack of knowledge regarding the VAT and posed it as a question rather than a statement for that very reason. Very uncool.

[askdanny]

Originally Posted by Ferrari308

The US is only doing reciprocal tariffs. This means that if any country is charging tariffs on our goods (which is almost anything & everything that we export), then we will apply the same tariffs on goods from that country.

It's not reciprocal when the formula is based on trade deficit, not actual tariffs.

I wonder what Switzerland is supposed to do when 99% of U.S. goods already enter Switzerland duty-free. Now they're being charged 31% in tariffs. I guess stop making products that Americans want to buy?

—Danny

[philhendrix]

Originally Posted by askdanny

It's not reciprocal when the formula is based on trade deficit, not actual tariffs.

I wonder what Switzerland is supposed to do when 99% of U.S. goods already enter Switzerland duty-free. Now they're being charged 31% in tariffs. I guess stop making products that Americans want to buy?

—Danny

well said.

hoping this is just a blip and we can return to normal at some point.

[EverCloserUnion]

Originally Posted by Ferrari308

At the same time, you have to recognize that tariffs are imposed heavily on any US made products that are exported. The US has applied no tariffs on anything in the post WW2 era. So, we in the US have allowed this for nearly 80 years.

The US is only doing reciprocal tariffs. This means that if any country is charging tariffs on our goods (which is almost anything & everything that we export), then we will apply the same tariffs on goods from that country.

It's intending to turn the market into a true FREE market and have the US companies have a level playing field with foreign markets.

You might notice that Canada has agreed to eliminate all tariffs with the US rather than to have to charge them. That came pretty quickly. Who is going to be next to drop their tariffs against the US? I am genuinely curious.


PDG

It's rare to see a post on this forum with so many errors.

No tariffs since the WWII? Not so. The US, like all countries, maintains a tariff schedule (typically on a MFN basis if an FTA or RTA isn't in place).

A level playing field? High tariffs do the opposite. They're intended to reduce imports by favouring the domestic producers. It's classic mercantilism (an economic philosophy that fell out of favour more than a century ago).

Canada has agreed to eliminate all tariffs? You should inform the Canadians - it'll be news to them. And no, the only news source reporting this elimination isn't credible.

And to bring this subject back on topic, on top of the Swiss tariffs on Rolex watches you'll also have the issue of dollar weakness vis-a-vis CHF.

[JRell]

Originally Posted by EverCloserUnion

It's rare to see a post on this forum with so many errors.

No tariffs since the WWII? Not so. The US, like all countries, maintains a tariff schedule (typically on a MFN basis if an FTA or RTA isn't in place).

A level playing field? High tariffs do the opposite. They're intended to reduce imports by favouring the domestic producers. It's classic mercantilism (an economic philosophy that fell out of favour more than a century ago).

Canada has agreed to eliminate all tariffs? You should inform the Canadians - it'll be news to them. And no, the only news source reporting this elimination isn't credible.

And to bring this subject back on topic, on top of the Swiss tariffs on Rolex watches you'll also have the issue of dollar weakness vis-a-vis CHF.

Thank you. Might I add knowing the industry well that the US can’t find enough skilled labor now to fill manufacturing jobs, so even if companies started more manufacturing here, which they won’t because our cost of labor is high compared to other countries, it will take 10 years to get enough into the trades. This should be a long term goal for the US. These tariffs hurt us getting to that goal.

[RolexSimon]

Originally Posted by Ferrari308

At the same time, you have to recognize that tariffs are imposed heavily on any US made products that are exported. The US has applied no tariffs on anything in the post WW2 era. So, we in the US have allowed this for nearly 80 years.

The US is only doing reciprocal tariffs. This means that if any country is charging tariffs on our goods (which is almost anything & everything that we export), then we will apply the same tariffs on goods from that country.

It's intending to turn the market into a true FREE market and have the US companies have a level playing field with foreign markets.

You might notice that Canada has agreed to eliminate all tariffs with the US rather than to have to charge them. That came pretty quickly. Who is going to be next to drop their tariffs against the US? I am genuinely curious.


PDG

Haha. You guys actually believe what you're being told? 10% tariff against Australia with whom you have a legally binding free trade agreement?
We have a 10% GST which is a sales tax and applies to Australian made goods as well as those from everywhere else. Exactly the same as the USA state-based sales tax except it is decided Federally here.
Well - now you're going to have to pay a lot more for watches which means we get ours now relatively cheaper. I guess you'll be buying Tiffany / Jacob & Co and Hamilton watches from now on.......