Story Highlight
– Zenith opens staff consultation for strategic repositioning.
– Approximately 201 roles affected, including internal and distribution.
– Shift towards very high-end watchmaking planned by 2029.
– Mid-tier model struggles to generate acceptable returns.
– Luxury watch market polarizing, favoring small number of brands.
Full Story
Zenith has initiated a consultation process for staff at its Le Locle site, revealing plans for a strategic shift within the brand. This move, confirmed on 22 October 2026, is expected to impact roughly 100 of the 196 employees at the facility, along with an additional 101 roles in its international distribution network. The outcome of this consultation, expected to conclude in approximately three weeks, has yet to be disclosed by the company. Reports, primarily from Le Temps, speculate that the repositioning will shift focus towards the high-end watchmaking sector, effective from 2029.
Benoit de Clerck, serving as Chief Executive since January 2024, has acknowledged the difficulties faced by the intermediate segment of the market. He stated that the model which previously maintained volumes and accessibility to Swiss watchmaking has ceased to yield satisfactory returns.
Zenith’s challenges reflect a larger trend observed in the Swiss watch industry, as highlighted by data from the Federation of the Swiss Watch Industry (FH) alongside estimates from Morgan Stanley and LuxeConsult. This trend indicates a polarisation within the market that has been steadily intensifying since 2023.
In 2025, Swiss watch exports decreased by 1.7%, amounting to CHF 25.6 billion, with unit sales declining by 4.8% to 14.6 million—the lowest in decades. Despite this downturn, the market segment priced above CHF 50,000 has seen its representation in export value escalate to 37%, marking an increase from the previous year. This upper segment, accounting for just 1.4% of total units sold, has generated approximately 89% of the overall incremental value growth in the industry.
The most prominent luxury brands, including Rolex, Patek Philippe, Audemars Piguet, and Richard Mille, now dominate nearly half of the market value, with Rolex alone responsible for upwards of CHF 11 billion in wholesale revenue. This selective concentration has intensified competition, leading to significant revenue declines for some brands.
Zenith has primarily positioned itself within the price range of CHF 8,000 to CHF 15,000, a category that is currently experiencing significant contraction. Its recent success with the G.F.J. Calibre 135, priced below CHF 50,000 and recognised at the Grand Prix d’Horlogerie de Genève, has raised questions about sustainability and future direction.
Founded in 1865 by Georges Favre-Jacot, Zenith is among the oldest ongoing watch manufactures, maintaining considerable control over its movement production. The El Primero calibre, launched in 1969, is historically significant, having survived the quartz crisis due to the efforts of Charles Vermot, who safeguarded the tooling against management directives.
Since its acquisition by LVMH in 1999, there has been little public disclosure regarding Zenith’s financial performance within the conglomerate, which has prioritised jewellery growth in its reporting. This creates a dual challenge for Zenith: an externally pressured mid-price segment and an internal environment that favours higher-return categories.
The company’s proposed focus on the upper price tier aims to escape what is termed the “Scarcity Premium Trap,” a situation where mid-tier brands struggle to maintain both volume and prestige as consumers gravitate towards more established luxury names. Increased prices without corresponding increases in perceived scarcity can exacerbate the situation, risking placement in a “no-man’s-land,” where products are seen as too costly for previous customers while lacking the rarity needed to attract ultra-wealthy clients.
As the consultation progresses, the restructuring points towards a plan for reduced volume paired with higher average selling prices and narrower distribution channels. This strategy aims to leverage the brand’s heritage while navigating the modern challenges facing Swiss watchmakers.
The consultation will clarify how many positions may ultimately be affected, but the anticipated focus on luxury, heritage, and a revised pricing strategy indicates a significant shift for Zenith as it aims for revitalisation in a competitive landscape. The next few years will be critical in determining whether Zenith can transform its legacy into a contemporary narrative of exclusivity and desirability.
