I've just been to see my watchmaker and he advised me that in his circle of colleagues, they have just heard that Cartier has given notice to 350 watchmaking employees in Switzerland and cut the production week to 2-3 days.

Zenith is also about to announce layoffs. He said this was a direct result of the downturn in the market effected by the Apple I-watch and others similar.
They say it is starting to affect the $500-3500 range. I'm hoping this is just a 'blip' and not too damaging like when the quartz revolution happened.

He also heard that Apple is considering a 'swiss' version to capitalise on the prestige market!! Yikes.

 

We have discussed this before. I believe, the one will be hit the hardest is in USD 100 to USD 1000 bracket. Above that people already consider emotional attachment to watch. I think watch player above USD 3000 will be safe. This is all speculation on my part.
If we take a look at that range, first victim would be Japanese branded watch such as Casio, Seiko, Orient and Citizen. Next the low end Swiss watch such as Swatch, Tissot, Wenger, Cyma etc. Third fashion watches such as Guess, Diesel, Fossil etc.

I am surprised about Cartier, since they have strong follower in Japan & China which should boost their mid range sales.

Apple targeted to sell 30 million iwatch annually, which if only 5% of it is the deluxe Gold edition that would surpass entire Rolex annual unit sales. It is a dumb value proposition IMHO. A 5K watch which will be obsolete in less than 5 year? (and leave only with gold scrap value)

 

Hi all,

I can understand people that don't buy more than one watch ever and then at under $500 and are already using their iPhone to tell the time with no longer buying any other watch But the rest of the population that aren't hooked into Apple and don't believe that Apple are the be all and end of of everything will still buy watches IMHO. Also from what I understand you have to have an iPhone 6 or 6+ to even be able to fully utilise the iWatch. I just really don't see this effecting anything but the low end of the watch market and certainly not Cartier or Zenith and especially not in the time since launch of the iWatch I mean are they even being delivered yet?

Marc

 

No...but all other brands are out there (samsung, Pebble etc) and once Apple announce something usually people hold off their purchase saving for the i****hit

 

Know several youngens that have placed names for them already......

 

There will always be watch people but I agree it is the lower end that will suffer. Heck I wanted a Dick Tracy watch when I was young

 

I think saying these cut backs have anything to do with the Apple watch is a very big stretch. The watch/gadget isn't even out yet, and companies don't react that fast with layoffs. The reasoning behind these layoffs that I have heard is the drop in sales in China - the government is cracking down (Chinese style anyway) on corruption, and luxury goods sales are off.

In addition to Cartier, Tag has laid off 46, and has some others working short hours.

http://www.sopjh.ch/index.php?page=a7dd12b1dab17d2&type=eco&id=15206&lang=fr&nid=5

http://www.sopjh.ch/index.php?page=a7dd12b1dab17d2&type=eco&id=15199&lang=fr&nid=5

http://www.sopjh.ch/index.php?page=a7dd12b1dab17d2&type=eco&id=15193&lang=fr&nid=5

http://www.sopjh.ch/index.php?page=a7dd12b1dab17d2&type=eco&id=15185&lang=fr&nid=5

Cheers, Al

 

I suspect the iWatch will attract many who don't currently wear a real watch.

 

The iwatch may very well attract new folks who wouldn't normal wear a watch, but those folks weren't beating down the doors of Omega and Rolex in the first place

The problems at Zenith are entirely the fault of Zenith and LVMH. Their offerings have flagged a bit and their marketing is useless.

 

That really make sense. China is the biggest market for luxury watches. Any drop in the sales will strongly affect the whole company business.

 

"Tag Heuer watches priced at 4000 francs are selling extremely well, which is not the case with those in 8000 francs and upward, "he said. "Like climbers to conquer Mount Everest, we take a step back to oxygen," says Jean-Claude Biver.

Interesting quote. So there are at least two possibilities:
1. Tag Heuer could not position itself to compete in upper market in China, or
2. The luxury gift market which usually costs above USD 5,000 dried up, while the middle class market segment still grow healthy which tend to focus on below USD 5,000 price.

 

I think also Tag has some issues competing at that higher price level. Tag produces some very technically advanced high end watches, but they have a certain stigma or position in the market that people will wonder why they should spend so much on "just a Tag." It's difficult for a company to move up market - Omega is one that is doing it fairly well actually.

 

I've owned several PC's and laptops, almost every version of iPhone since its release, and an assortment of iPads -- just like your typical techy 31-year old. But I will never buy an Apple Watch. I only have one left wrist, and I'd much rather have something with history, tradition, and substance on it instead of a China-made circuit board that's going to be obsolete in a few years.

If anything, I think these "smartwatches" will bring more attention to what one is wearing on their wrist. I'm anticipating that moment when someone with an Apple Watch asks me what I'm wearing -- I'll be ready with my vintage pieces.

 

The problem is they already have set high-end boutique across city in Jakarta. It certainly will hurt their bottomline if they can only move lower price items. By comparison Longines have much humbler smaller showroom and in many case combining with other brand.

 

Latest Pepper Jeffrey Survey on 7200 teenagers in US , 67% of them owned Iphone, rose from 61% in spring. A whooping 73% of them would like to have iPhone for replacement.
iWatch? Only 16% would want them. Probably the iWatch threat is not as scary as its look.

 

Can't do pre-orders for the watch so while they may want one they haven't reserved one.
A lot of misinformation flying around about the watch. Prices beyond the starting point ($349) haven't been announced so everything else is pure speculation.

 

The iWatch is essentially an accessory and therefore wont be needed or wanted by all. I cannot imagine it taking off with the under 25 crowd, which doesn't even know what a watch is. I do think it will sell in the hipster market, but it wont bring the stock up. Some are predicting it brings the stock down. We will see.

A thought occurred to me last night... By the third generation the iWatch needs to have a replaceable movement. Otherwise it's just a throwaway device and who wants to spend a grand or more on a rose gold watch that's worthless in a few years? Finalize the design (case, glass, crown, etc.) by gen 3 and allow the inner mechanics and electronics to be replaced with each generation of the watch.

Tag makes some great pieces among the mishmash of puke but I'll never buy one. For the most part I dislike their design aesthetic and if were to buy one of the pieces I do like I know I'll take a bath if I ever have to flip it. No thanks.

Omega certainly has moved themselves upwards but I'm not exactly thrilled with this. Their price increases have reached ludicrous levels and now the Speedy line is out of sight as is the new Seamaster 300 and maybe even the Planet Ocean. I just can't touch those prices. At least not right now.

 

They are? Their new F1 line, which has historically been entry level, has moved to all automatic movements and essentially doubled in price. Not a move you'd make if you're trying to move downmarket.