Kering’s Swiss watch brands cut staff by 25% after pandemic hit sales

ZURICH (Reuters) – Owned by Kering PRTP.PA Swiss watch brands Ulysse Nardin and Girard-Perregaux announced on Monday that they were cutting around 100 jobs, or a quarter of their total workforce, after sales were hit by the coronavirus crisis.

The Swiss watch industry has seen demand plummet during the pandemic, with stores around the world remaining closed for months and Chinese tourists no longer flocking to luxury malls like Paris.

“The sudden drop in sales caused by the pandemic, and subsequently, the timid recovery of the watch sector, led to the decision to reduce these manufacturing capacities,” the two brands said in a press release.

Patrick Pruniaux, CEO of the two brands since 2018, said the economic repercussions of the pandemic were “likely to have a ripple effect over the next few years”.

Swiss watch brands from French luxury group Kering were among those at Geneva Watch Days 10 days ago to try to revitalize demand, but show officials said they fear job losses, particularly among suppliers.

Kering said in its July half-year report that Ulysse Nardin and Girard-Perregaux, acquired in 2014 and 2011 respectively, were in “deep transformation processes” after operating in a fragile market environment for years.

Sales of the two brands contracted sharply and their losses worsened in the first half of 2020, leading Kering to recognize asset impairments of 201 million euros ($238 million) for the watch brands and the fashion brand. Brioni.

Reporting by Silke Koltrowitz; Editing by Alexander Smith

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