ROLEX PRICES COULD JUMP 40% FROM NEW SWISS TARIFFS

Rolex

Summary:

• U.S. implements 39% tariff on Swiss imports effective August 7, 2025
• Swiss watchmakers must decide between absorbing costs or raising consumer prices up to 40%
• Policy part of Trump administration's tiered tariff system targeting countries with large trade deficits

The Trump administration imposed a 39% tariff on all Swiss imports through executive order, creating one of the highest trade barriers in the current reciprocal tariff program. The policy took effect August 7, 2025, after bilateral trade negotiations with Switzerland failed to reach agreement before the administration's deadline.

Officials cite a $38 billion U.S. goods trade deficit with Switzerland as justification for the measure. This rate surpasses the 15% tariffs applied to European Union, Japan, and South Korea, which secured preliminary trade agreements before the August cutoff date.

Switzerland exported over $6 billion worth of watches to the United States in 2024. Major manufacturers including Rolex now face a choice between absorbing the additional costs or transferring them to American buyers. Some retailers have already increased prices by 15% in response to the tariff announcement.

Smaller independent watchmakers will experience the most pressure from these new costs. Industry analysts expect collectors to shift toward pre-owned markets and secondary sales platforms to avoid the price increases on new timepieces.

The Swiss tariff represents part of a broader trade policy restructuring that began in April 2025. The administration established a baseline 10% global import rate while threatening higher duties for countries refusing trade negotiations. By July, officials formalized a three-tier system: 10% minimum rates, 15% for nations with negotiated agreements, and elevated tariffs for countries with substantial trade surpluses.

Canada's tariff increased from 25% to 35% under a separate order related to drug enforcement cooperation issues. Other countries face varying rates, with India at 25% and Syria at 41%, affecting dozens of bilateral trade relationships worldwide.

The watch industry must now adapt to these new cost structures. Large manufacturers possess more resources to absorb tariff impacts temporarily, while smaller brands will likely pass costs directly to consumers. This pricing pressure could accelerate existing trends toward vintage and pre-owned luxury watches, where buyers avoid new-product tariffs entirely.

Market observers expect the policy to reshape luxury goods distribution channels, with some brands exploring manufacturing relocations or supply chain adjustments to minimize tariff exposure. The full impact on consumer behavior and industry structure will become clearer as the policy remains in effect through the coming months.