After ETA world is coming...

[FasTTaP]

Quote from http://watchinghorology.com/

BREAKING NEWS - World No.3 Swiss movement supplier acquired by Hong Kong group

It has finally happened. The Chinese are firmly entrenched and will be making serious impact on the Swiss watch industry. It was reported in LeTemps.ch that the Peace Mark Group from Hong Kong had acquired STM group of companies - the world no.3 in watch movement supplier (both in quartz and mechanical movements). The amount of the buyout transaction was not be disclosed but the 1500 employees will be taken over, namely 154 in Sion (VS), around 70 on the site of Les Reusilles (BE) and the 1200 based in China.

The STM group comprised of Soprod (who supplied to some well known brands such as Richard Mille) Swiss Ebauche and Indtec. Soprod is the jewel in the crown as it provides ETA type/based ebauches to various brands. They provided customisation service to fit the movements to the brands. The Peace Mark Group already owns the Swiss brand Milus and now will be able to reposition itself in the Swiss watch heirarchy both for Milus as well as any other brands in its stable.

For some years there had been debates and discussion in the Swiss industry how it would meet the challenge of Chinese made watches esp. its ever improving quality in finishing and even the Chinese tourbillons. It seems that the Swiss had miscalculated the financial clout of the Chinese and their desire to control the lucrative watch market. With the control and access to these important Swiss movement manufacturers, it appears that the Swiss industry is in danger of losing its competitive edge. Will the movements still be Swiss Made? Will the Chinese movements have the right to be called Swiss Made?

The Swiss industry appears to be in for an interesting and rough ride over the next few years.

[Victoria]

Coals to Newcastle...

[Dizzy]

its gunna be interesting to see how this all turns out..

[Pix]

Will Switzerland soon make reps of Chinese genuine movements..?

[ironmarshal]

That would be the definition of irony wouldn't it?

[cornerstone]

The more interesting power play is perhaps not so much between China and Switzerland, so much as between "fashion watches" and the top Swiss brands. Peace Mark retail top brands in China, but manufacture a good lot of all those fashion watches we see in malls everywhere too. The financial muscle that comes from the latter is helping them to muscle in on the former.

I'm sure there's an Australian connection to that company too, something in the back of my mind. I'm think I read within the past year that one of Sydney's most expensive houses (in the $20m range) was sold by a guy who had built up this massive fashion watch business in Hong Kong.

[geo1nah2a]

/snip:

the 1500 employees will be taken over, namely 154 in Sion (VS), around 70 on the site of Les Reusilles (BE) and the 1200 based in China.

/snip: Will the movements still be Swiss Made? Will the Chinese movements have the right to be called Swiss Made?

Thank you for the report.

The ratio of employees: 80% in China based and I guess most of the 20% is HQ, sales and RD.

Is this what "SWISS MADE" stands for? Where are the calibers manufactured? I have read elsewhere what it takes to claim a SWISS MADE stamp, but the above info reveals a different practice. White lies anybody?

[MrC]

Thank you for the report.

The ratio of employees: 80% in China based and I guess most of the 20% is HQ, sales and RD.

Is this what "SWISS MADE" stands for? Where are the calibers manufactured? I have read elsewhere what it takes to claim a SWISS MADE stamp, but the above info reveals a different practice. White lies anybody?

Federation of the Swiss Watch Industry (FH) decides what the standard is. They recently raised the min requirements:

the Swiss-Made mechanical watch must have at least 80 percent of its production cost relevant to operations conducted in Switzerland. For electronic watches, the rate makes up 60 percent.

the watch's technical construction and prototype development must be fulfilled in Switzerland. Production cost does not include raw materials, gems and batteries.

under the old ordinance, 50 percent of the movement's value must be relevant to Swiss-made parts. For the mechanical movements, the FH proposed to increase this proportion to a minimum of 80 percent, and to 60 percent for electronic movements.

[cornerstone]

Federation of the Swiss Watch Industry (FH) decides what the standard is. They recently raised the min requirements:

the Swiss-Made mechanical watch must have at least 80 percent of its production cost relevant to operations conducted in Switzerland. For electronic watches, the rate makes up 60 percent.

the watch's technical construction and prototype development must be fulfilled in Switzerland. Production cost does not include raw materials, gems and batteries.

under the old ordinance, 50 percent of the movement's value must be relevant to Swiss-made parts. For the mechanical movements, the FH proposed to increase this proportion to a minimum of 80 percent, and to 60 percent for electronic movements.

That's interesting, cheers. As I understand it they have voted to propose the change, but the authorities and government have yet to decide on the matter. Interesting times ahead.