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Endeavor

Will Swatch Group Monopoly survive?

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An interesting and complex read - which is why it has taken me so long to respond!

The whole Swatch thing is about greed, self-interest and protectionism. Ultimately it will screw itself into the ground while Japanese and Chinese manufacturers will continue to be successful.

Just my two-pennorth...

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1 hour ago, WillFly said:

The whole Swatch thing is about greed, self-interest and protectionism. Ultimately it will screw itself into the ground while Japanese and Chinese manufacturers will continue to be successful.

I agree on the first part (but please extend it to all Swiss and Germans manufacturers), but not on the second. For 99% of buyers, how Swatch does its business is totally irrelevant, even if it affects their recurring costs after purchase. Japanese may get a moderate grow but having only one globally appealing top brand they are very limited. And Chinese are completely a different category, they don't even supply spare parts at all.

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Good points, jdm, though my comments about Asian manufacturers weren’t aimed solely at named brand makers such as Seiko, Casio, etc., but the whole gamut of production.

I can go on eBay and buy all the bits I need to construct my own watch - movement, case, dial, hands, strap - all Chinese made and available via Hong Kong sellers. Which is what I did a few years ago. Go to Wills Watch Pages and click on the watch labelled Custom on the Wristwatch page...

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50 minutes ago, WillFly said:

Good points, jdm, though my comments about Asian manufacturers weren’t aimed solely at named brand makers such as Seiko, Casio, etc., but the whole gamut of production.

There are only two Japanese mechanical mov.t left (which  however equip a good 70% of the affordable microbrand makers) but the only player which can compete technically and in image with the Swiss is Grand Seiko. BTW GS  don't even have any service center except in Japan, and their idea about the upper segment of the watch market is identical to the Swiss: keep the profit margin as high as possible and don't let anyone work on products. So if we compare apples with apples, we find that
If you're buying a watch (not quartz and not fashion) below $200 you have Japan or Chinese. Below $1,000 the same, plus the occasional Tissot. But at the $2,000 marker already, only Swiss and Germans are left, and I think they will remain at the top.
If you're an hobbyist, stay with Japanese or older / economical Swiss watches. Lots of parts and lots of fun, minus the anxiety of working on an expensive, late piece.
If you're a pro, step up your game and take the all the possible training from the official brands, which will give you access to parts and technical database. You can also keep doing special work like lathe and restoration, which is also well paid. 

50 minutes ago, WillFly said:

I can go on eBay and buy all the bits I need to construct my own watch - movement, case, dial, hands, strap - all Chinese made and available via Hong Kong sellers. Which is what I did a few years ago. Go to Wills Watch Pages and click on the watch labelled Custom on the Wristwatch page...

Sure, and I have in the drawer a design of my own which will be China made. In Hong Kong I've found that they're nice hard working people, but when you ask for something they don't have at hand, or have direct experience making, you may be disappointed. And their entire industry is very secretive also. If you look carefully the only truly high quality production that comes out of China is from European or Japanese factories (equipped with European or Japanese machinery). The only exception could be Sea-Gull, and the makers of the very top end fake Rolex. I'll admit that they know what they are doing :)

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Another point from the article, and of course things are open for different interpretations; but according to the information by 2020 the Swatch Group will no longer be obliged to sell mechanical movements to other Swiss watch companies. It is then assumed that those other companies will produce their own parts & blanks. This may be the case, but it could also mean the end of smaller / medium Swiss watch companies ...... unless they joint the Swatch-group or the seek help from another sources. By seeking help, most likely from outside Switzerland, their watches can't be called "Swiss-made" anymore; reducing the diversity of "Swiss-made" watches. One could also question whether these small companies are able to have a decent market-share, facing higher Swiss labor cost and have to compete against the "big-eastern-boys"

It would be very strange that if the Chinese / Japanese won't welcome these smaller companies, or perhaps their product, with open arms. The end result will be (again) less jobs in the west, more jobs & work for the Chinese / Japanese .....

And so the story continues ........

 

 

 

Edited by Endeavor

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6 minutes ago, Endeavor said:

Another point from the article, and of course things are open for different interpretations; but according to the information by 2020 the Swatch Group will no longer be obliged to sell mechanical movements to other Swiss watch companies. It is then assumed that those other companies will produce their own parts & blanks.

Actually this is happening already. In the low end (by Swiss standards) there is the likes of Sellita, Soprod, and STP which is the latest arrival, all happily pumping out large quantities, for the small and large brands. 100% Swiss and even if they make some parts or process overseas, that falls easily within the regulations to branded Swiss made. Above these there is a smaller group of "elite" makers like Parmegiani's selling exclusive mov.ts to anyone, or the Chrono module makers. In the end, the Swiss have been doing this for centuries. It is very easy for them to adapt and reform. There will never be a scarcity of Swiss mov.t, unless you want them to cost them under 100 FF.

 

6 minutes ago, Endeavor said:

It would be very strange that if the Chinese / Japanese won't welcome these smaller companies, or perhaps their product, with open arms.

Not sure what do you mean. Chinese and Japanese never, ever, produce anything with imported parts. And the latter historically has a preference for fully vertical industrial model. If they want a slice of the pie of some industry they are not competitive, they just buy the company and start supplying them with Asian parts.

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1 hour ago, Endeavor said:

Yes, JDM, that is what I meant, the Chinese / Japanese will be very happy to supply them with Asian parts 

What I am saying is that this is happening already, since decades. Swiss companies have factories in China, owned or participated, and that includes the Swatch group. And one Swiss movies.t maker is owned by Chinese. The current regulations allow to label as Swiss a watch with many parts made overseas. Said regulations have become more strict this year, but those that know how to play will keep exploiting them. BTW it is the same with Japan and their mark.

What we will never see is a Swiss watch of a decent brand to carry any part visually riconducibile to China.

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