By Carol Ryan

Immediate losers from President Trump's tariff onslaught are Swiss watches and charm bracelets. Switzerland faces a 31% tariff on exports to the U.S., higher than the 20% rate on EU goods like French champagne and Italian handbags.

This hit the shares of Richemont, the maker of Swiss watch brands Vacheron Constantin and Piaget, as well as Omega's owner Swatch.

Danish charm bracelet maker Pandora fell 12%. President Trump imposed a 36% tariff rate on Thailand, where the company does its manufacturing. This is far worse than the 10% levy management was bracing for.

Analysts at UBS think prices of luxury goods will go up 6% on average in the U.S. to offset tariffs. This will be most manageable for ultra-expensive brands like Brunello Cucinelli and Hermes that cater to superrich customers, but trickier for others.

The wider worry is that a trade war tips other countries into a slump. A 54% tariff rate on China-a critical market for luxury brands-could make Chinese consumers hesitant to spend on designer baubles. Together, American and Chinese shoppers drive more than half of global luxury sales.

This explains the sharp drop at Burberry, which was otherwise spared by the U.K.'s relatively lenient 10% tariff rate. That's irrelevant if consumers around the world are in no mood to splash out on $2,000 trenchcoats.

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(END) Dow Jones Newswires

April 03, 2025 06:45 ET (10:45 GMT)

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