How 39% Swiss tariffs will reach prices

US buyers of Swiss products, from luxury watches and skin care to craft chocolate candy, could soon face a sharp rise in prices if the negotiators cannot reach a deal to divert 39% rates that must come into force on Thursday.

The message last week that Switzerland faces one of the highest tariffs in the world in the world stunning many politicians, analysts and companies who thought the country was close to negotiating a deal similar to that of European Union and Britainwhich have a basic percentage of 15% and 10% respectively.

US has a huge trade deficit with Switzerland, generally $ 38.3 billion in 2024. The Swiss government states that the difference is partly due to the status of the latter as the largest center for the refining of gold, with huge quantities of the precious metal passing through the country for processing before being sent worldwide. Both gold and silver were released from the policy of the White House reciprocal tariff, launched in April.

The United States is also a major importer of Swiss pharmaceuticals, an industry that has been sank into confusion about the tariff tariffs with which he will encounterand medical devices. Pharmaceutical products are currently released from 39% taxes, although the tariff -specific tariff can still fall into the individual section of the United States 232 investigationS

But users will be familiar with high-end Alpine Country products, from Rolex watches to first-class skin care products and cosmetic products. Sales can be shaken if 39% rates remain in force for a long period – something Currently, Swiss negotiators are fighting to avoideconomist Warning for a huge hit of growth, jobs and sharesS

The United States was the largest abroad market for Swiss watches in 2024, with exports totaling 4.37 billion Swiss francs ($ 5.4 billion), and according to The Federation of the Swiss Clock Industry.

In order to qualify as a Swiss, at least 60% of the manufacturing costs of the clock must be based on Swiss, while its technical development is to be carried out in the country.

“The Swiss watches have long been a cornerstone on the US market, and the 39% tariff would be a real shake,” Paul Altiers, founder and executive director of the BOB online resale platform, told CNBC.

“Suddenly, every import would carry huge additional costs, and dealers will collide with difficult choice -they absorb the tariff, eat in margins, or pass it on to customers. You will probably see the longer times, as the brands and retailers redirect the logistics and higher prices of the sticker stickers.” The retail price of the Rolex submarine can jump from $ 10,000 to nearly $ 14,000, he noted.

For Swiss watches, 39% Tariff would be “devastating”, Jean-Philip Bertshi, head of Swiss Equity Research in VonTobel, CNBC’s Squawk Box told Tuesday.

“They have increased prices already in the spring by an average of 5 to 10%. I think another hit will be quite difficult for US users for sure, especially for entering the middle segment level.” In a vontobel research note marks Swatch As a vulnerable tariff, the shares fell by 2.3% on Monday.

“For luxury watches, for brands like Rolex, Patek Philippe and Audemars Piguet, you have several long waiting lists. So I think it will be more convenient to increase prices,” Bertshi continued.

“You have many limited measures to take. You can, of course, increase efficiency and try to take some other measures to counteract US tariffs, but overall, very challenging for the industry.”

Giant consumer goods Nestlé is one of the largest companies in Switzerland. The company says it faces a minimal direct impact on tariffs as it produces more than 90% of what it sells in the United States locally.

In general, this is the case of consumer brackets, such as immediate coffee or bottled water, low -ticket items, said James Edwards Jones, managing director of RBC Capital Markets consumer research, CNBC’s Squawk Box Europe told.

His popular Nespresso coffee brand, known for home machines and capsule pods, can however be among those goods at higher prices and therefore an increase in prices.

“More conspicuous in the case of Nestle, Nespresso is manufactured in Switzerland and then exported worldwide, so it seems likely to be caught in a small way,” added Edwards Jones.

Nestle did not immediately respond to CNBC’s request for a comment on the impact of Swiss taxes. The company does not indicate the level of US sales for Nespresso but its Semi -year results Showed North America has grown with a “strong double -digit percentage”.

Headquarters GALDERMAWhose products include injectable aesthetics and Cetaphil Facewash, in the meantime, it said it does not produce in Switzerland and is currently excluded from global tariffs in pharmaceutical releases.

However, its large production capacity in the European Union, the United Kingdom and Canada may be subject to higher taxes, potentially reaching consumer costs.

Higher import duties are also observed by raising the price of luxury goods, including Richemont-High -end jewelry brands Cartier and Van Cleef & Arpels.

Bofa Securities said in a note on Tuesday that 7% of Richemont’s input costs will be exposed to higher Swiss tariffs, probably adding to higher consumer prices. “The increase in prices would be the most clear way to soften the wind,” analysts wrote.

Richemont did not respond to CNBC’s request for a 39% comment, but he noted in his first quarter that tariffs could lead to “increased prices”, which could affect consumer demand.

Lombard Odier noted that a “small fraction” of luxury exports may see that demand for their products is increasing with the price, but the widespread price increase was definitely to harm consumers’ demand.

Roger Verley, director of the Chocosuis chocolate chocolate chocolate chocolate chocolate chocolate chocolate chocolate chocolates, said the 39% tariff rate would be transferred by prices and would lead to a steep US business for many of the group members. Recent Assess the Swiss Frank vs. State Dollarwhich leads to imports to be more expensive means that an effective price increase will be closer to 55%, he noted.

The main impact will be on small and medium -sized enterprises that are unable to use US manufacturing sites such as large multinational companies, Wehrli said. Industrial jungle Lindt & Sprüngli and Barry Kalebaut They already have factories, while the younger members of Chocosuisse such as Camille Bloch and Läderach produce exclusively in Switzerland.

“There is another specific problem with production in the United States,” Verley continued.

“If you want to mark your chocolate as a Swiss, then it should be produced in Switzerland. This is a quality sign in the international market, so you will lose more or less customers if it is no longer Swiss origin,” Verley told CNBC.

These origin rules are forced tooblerone owned by the American group Mondelez International., to change your packaging in 2023 To treat himself as “established in Switzerland” rather than “Swiss chocolate” after he moved some of his production from the Swiss capital Bern to Slovakia. CNBC contacted Mondelez to comment on the impact of Toblerone Tariffs in the US