Silke Koltrowitz

ZURICH (Reuters – Zenith is a Swiss watchmaker that is owned by LVMH. However, it has been observing carefully the impact of Russia’s crisis on its sales.

Julien Tornare, a telephone interviewee with Reuters said that geopolitical instability can lead to anxiety which is bad for business.

Tornare has led the brand’s management since 2017, when he stated that “Purchasing power and petrol prices are worrying for people”

However, he said that many markets, including the United States, are still performing well and that he believed the brand would see double-digit growth in its first quarter. He also stated that he would be aiming to achieve that level for the entire year.

Rival Swatch Group’s (SIX) Thursday statement confirmed that the company expects to see double-digit sales growth and have no adverse effects from Russia’s incursion into Ukraine.

Tornare stated that Russia is not the key market for his brand, despite having a rich history in Russia. He said, “If the circumstances allow it,” that he would redeploy resources to grow this market.

Its parent company LVMH, which had 124 shops in Russia closed temporarily on March 6, but stated it would pay its salaries to its 3,500 employees.

While he said that China’s new restrictions to COVID-19 are a concern and China was still a major growth engine in the long-term, he also stated that China’s lockdowns were necessary. We had a positive start in China in January. The pace was a little slower in February and March.

Tornare claimed that while the brand wants to absorb some of the increased costs in energy and raw material, it will increase prices worldwide by 2 to 4 percent for selected collections over the following weeks. Tornare, who is now CEO, has a price average of 10,000 euro ($11,000.00), which is 30% lower than the previous CEO.

Zenith’s El Primero watch mechanism, which was launched in 1969 in Le Locle (western Switzerland), is well-known. It survived until the advent of quartz watches with battery power in the 1970s. This happened because the foreman hidden the plans and tools from management. Today, Zenith watches still use modernised El Primero versions.

($1 = 0.9020 euro)