Breitling CEO Expects Trump to Cut Tariffs for Swiss Watchmakers
(Bloomberg) — Breitling AG’s chief executive officer expects the US to cut tariffs on Swiss watches, underscoring his bullishness on the private equity-backed firm’s biggest market even as Washington keeps the industry guessing.
“I am confident that we will solve the issue of 15% and that it will go lower,” Georges Kern said in an interview Monday at Breitling’s office in Zurich.
The watch industry was jolted in July when President Donald Trump imposed tariffs of as much as 39% on imports from Switzerland — the highest rate applied to any developed economy. Watchmakers including Breitling, Swatch Group AG and Cartier-owner Richemont faced a major margin hit, and though the duties were later retroactively reduced to 15%, that is still well above historical levels.
Kern has regularly argued the levy makes no sense given Swiss watchmakers do not compete with domestic production and that US consumers buy the products because they are made in Switzerland.
“There is no American watch industry — we’re not taking away any jobs in the US,” Kern said, adding that Breitling raised prices 4% due to the levy. “I wish I could decrease prices as soon as the tariff will go down.”
His comments come after Trump laid bare the chaotic nature of tariff talks. The president said at the World Economic Forum in Davos last week he set the original 39% levy because former Swiss President Karin Keller-Sutter “rubbed me the wrong way” during a phone call.
“I reduced it because I don’t want to hurt people,” Trump said, before throwing in a typical warning. “That doesn’t mean it’s not going up.”
Still, Kern said he remains upbeat. He pointed to recent comments by Keller-Sutter’s successor, Guy Parmelin, suggesting negotiations with the Trump administration are continuing behind the scenes to lower the tariff.
Speaking to the Neue Zuercher Zeitung newspaper, Parmelin also said post-tariff data showed the US now enjoys a trade surplus with Switzerland, undermining Trump’s core argument for the levy.
The Swiss government is due to publish its latest trade data on Thursday. The update last month showed a Swiss trade surplus of 3.4 billion francs ($4.4 billion) with the US in November.
Key Market
“The US is still going to be the main market for us,” Kern said. “The fundamentals are great — low energy costs, investment incentives, a strong labor market — while the fundamentals in Europe are not good.”
Breitling has been under private equity ownership since 2017. It’s currently controlled by Partners Group Holding AG with a 51% stake, while CVC Capital Partners holds roughly 25%.
Rumors have swirled around a potential initial public offering, though Kern — who previously ran Richemont’s watch division — said other options could also be available such as investment from a big group or sovereign wealth funds.
Public markets have also not been kind to watchmakers, with a soaring Swiss franc, record gold prices and weak demand in China weighing on valuations. Nick Hayek, the CEO of Swatch, has previously said delisting the company would be an advantage given its shares halved in value in the past three years.
Strategy
Under Kern, Breitling has added two brands to its core offering. In 2023 it acquired high-end marque Universal Genève, followed by entry-level brand Gallet in 2025. Both are set to relaunch this autumn.
Gallet will be positioned as an active, outdoors-focused brand, with prices ranging from 2,500 to 5,000 Swiss francs — a segment the company had exited as Kern pushed the core Breitling brand upmarket. Universal Genève will start at about 15,000 Swiss francs, with some models priced much higher.
But the strategy has raised questions about risk and cost, and S&P Global Ratings lowered its credit score on Breitling last year. “You have to wait until you’re ready and show the potential,” Kern said. “But you need to prove it to the market and you need one or two years minimum.”
Read: Swiss Watchmaker Breitling Downgraded by S&P on Weak Demand
Breitling’s shareholders are giving Kern the benefit of the doubt on what he calls the Breitling-led “house of brands,” the CEO said.
Partners Group co-founder Alfred Gantner was part of the informal diplomacy, alongside Richemont Chairman Johann Rupert and Rolex CEO Jean-Frédéric Dufour, that helped to break the stalemate on trade between Swiss officials and the Trump administration last year.
“It’s booming. AI, everything is in the US,” Kern said. “Capital is there, everything is there. I’m very confident on the US, very confident.”
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