LVMH Denies Zenith Sale—But the Real Story Runs Deeper
LVMH has publicly denied rumors of a potential sale of Zenith, a brand known for its horological accolades and the iconic El Primero chronograph. Despite the denial, speculation persists regarding the brand's financial struggles, including annual losses of 20-30 million Swiss Francs and declining sales since 2023. The recent acquisition of a minority stake in Swiss movement manufacturer La Joux-Perret and plans to enhance Zenith's role as a movement manufacturer hint at a strategic pivot within LVMH's watch division, raising questions about the future viability of traditional watch brands in the luxury market. Industry analysts suggest that brands like Zenith and TAG Heuer face existential challenges amid shifting consumer preferences towards hybrid luxury-jewelry offerings. While LVMH's jewelry brands remain insulated from these pressures, the watchmaking sector appears vulnerable, with significant operational losses reported. The tension between maintaining heritage and achieving profitability could lead LVMH to reconsider its investment in watch brands, potentially prioritizing jewelry over traditional horology. As the market evolves, the sustainability of authentic manufactures within luxury conglomerates will be increasingly scrutinized, with the upcoming year likely to be pivotal for Zenith's future.
