Bloomberg investigates how the 2009 GFC is impacting the Swiss Haute Horlogerie production and the difficulties faced with the recent surge in demand
Switzerland: Luxury Watchmakers Struggle to Meet Demand
Over the last decade, collaborations between luxury brands and contemporary artists have gone beyond mere artistic partnerships towards a new kind of luxury branding.
PARIS – Art and fashion have always developed side by side, for fashion, like art, often gives visual expression to the cultural zeitgeist. During the 1920s, Salvador Dalí created dresses for Coco Chanel and Elsa Schiapparelli. In the 1930s, Ferragamo’s shoes commissioned designs for advertisements from Futurist painter Lucio Venna, while Gianni Versace commissioned works from artists such as Alighiero Boetti and Roy Lichtenstein for the launch of his collections. Yves Saint Laurent’s vast art collection, recently auctioned at Christie’s in Paris, testified to his great love of art and revealed the influence of a variety of artists on his own designs.
In the 1980s, relationships between luxury brands and artists were advanced when Alain Dominique Perrin created the Fondation Cartier. In the Fondation Cartier pour l’Art Contemporain, a book marking the foundation’s 20th anniversary, Perrin says he makes “a connection between all the different sorts of arts, and luxury goods are a kind of art. Luxury goods are handicrafts of art, applied art.”
The Fondation Cartier pour l’Art Contemparain building in Paris
Bloomberg investigates how the 2009 GFC is impacting the Swiss Haute Horlogerie production and the difficulties faced with the recent surge in demand
Bloomberg investigates how the 2009 GFC is impacting the Swiss Haute Horlogerie production and the difficulties faced with the recent surge in demand.
During the 2009 global financial crisis, Swiss timepiece exports fell approximately 22%, resulting in mass manufacturing redundancies across the industry. As demand sharply rises again, increasing by the same 22% from 2009 – 2010, luxury brands are finding it tough to source high quality parts, as well as workers with the precise skill levels necessary to complete assembly.
Thierry Stern, CEO of Patek Philippe, explains that whilst many craftsmen are willing to work, few posses the experience and expertise to confidently complete production. Patek Philippe produces roughly 45,000 pieces per year, all by hand in their Swiss workshop, and Stern goes onto explain that training is a matter of years, not merely weeks or months as in other industries. Therefore, even a commitment to further training their workforce would not yield results in time to meet the forecasted demand of the coming years.
“ Export turnover peaked in 2008 at 17bn CHF, which is expected to be surpassed by mid-2011 ”
Luc Perramond, CEO of La Montre Hermès, is similarly finding it difficult to source high quality parts, particularly those he considers strategic, such as movements, casing and hands. Explaining that suppliers are experiencing difficulties returning to the capacities they had become accustomed to before the crisis, Perramond is also concerned with meeting demand in 2011.
The industry peaked in 2008 with an export turnover of 17 billion CHF, which forecasters are expecting to be surpassed in the first half of 2011. However it has also been speculated that the recent events unfolding in Japan, coupled with the markets heavy reliance on Asia, may give Swiss producers an opportunity to slightly recover, as the recent steep increases in demand begin to plateau.
Creative Strategist, Digital
Sophie Doran is currently Senior Creative Strategist, Digital at Karla Otto. Prior to this role, she was the Paris-based editor-in-chief of Luxury Society. Prior to joining Luxury Society, Sophie completed her MBA in Melbourne, Australia, with a focus on luxury brand dynamics and leadership, whilst simultaneously working in management roles for several luxury retailers.