The cost of Swiss-made printing equipment is set to rise after the country’s currency rose 15 per cent against the Aussie Dollar after initially jumping by 20 per cent of its value.
The dollar is now worth only 0.72 Swiss Francs after the famous European currency haven’s National Bank removed a three-year-old restriction capping the franc at 1.20 per Euro.
The Australian currency fell from 0.84 francs to about 0.70 on January 15 before recovering slightly to its current level, but this was nowhere near as bad as the Euro, which initially crashed 30 per cent.
The currency cap was introduced in 2011 at the height of the euro zone crisis to prevent the strong currency leading to deflation and a recession for the export-reliant Swiss economy, but the bank says the ‘temporary’ measure is now unsustainable.
Prices on equipment from Swiss manufacturers like Gallus, Muller Martini, Bobst, swissQprint, Hunkeler and Ferag is certain to rise, though it is too early to tell where the franc will settle once the market calms down, and how much manufacturers will be able to absorb.
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If the current 15 per cent rise were to be passed on in full, the cost of a finishing line worth $300,000 would rise to $345,000, and a $1m label press to $1.15m.
Ferag Australia managing director Daniel Faesser says prices will have to rise but he expects the franc will weaken over time as the market is just panicking now.
“No one knows exactly how things will develop from here, but I think it will go down again once investors calm down,” he says.
“We of course negotiate with every customer so I cannot say exactly how much prices will go up, but obviously the currency has a significant effect, which we very much regret.”
Faesser says the Swiss National Bank could no longer defend the policy considering the demand for the relatively stable currency while the Euro is in crisis.
Philip Trumble, managing director of swissQprint distributor Positive Camtec, says prices will also rise for his products.
“We will try to absorb as much as we can, but with the increase being so big we simply cannot take on all of it,” he says.
Label press manufacturer Gallus says it has not yet been advised by head office as to how its prices will be affected, while Muller Martini could not be reached for comment.
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