War of horology Smart vs. Mechanical

By Rachel Lee

It looks as if luxury watchmakers were waiting to see what Apple had planned. After the company’s Apple Watch announcement, the traditional watch industry had mixed reactions: Shares in major watchmakers, including Swatch, fell about 2 percent from their intraday high on the day the Apple device was released.

But some traditional watchmakers are confident that Apple’s new smartwatch poses no threat to their business because the new device lacks something that consumers value.

“Its design will not stand the test of time,” said Jean-Claude Biver, who heads LVMH’s luxury watch division.

Stephan Linder, TAG Heuer’s CEO, refers to the Apple devices as “cheap, plastic-designed watches.”

It seems certain that Tim Cook is aiming outside of the technology circuit and toward the high-end luxury watch market, as shown by two recent hires at Apple: ex-Burberry boss Angela Ahrendts and TAG Heuer’s former vice president of sales Patrick Pruniaux.

Are luxury watchmakers losing any sleep over the American electronics giant’s new product? The answer is yes and no: Popular brands such as TAG Heuer are ready to jump into the smartwatch competition.

According to NZZ am Sonntag, Biver said, “We want to launch a smartwatch at TAG Heuer, but it must not copy the Apple Watch.”

But ROLEX, Van Cleef & Arpels, and other traditional watchmakers say they will continue to do what they do best.

Paul Gerzog, manager of an exclusive boutique on Zurich’s famous shopping street Bahnhofstrasse, where watches cost between 6,000 and 250,000 Swiss francs ($639 to $266,154 USD), agrees with this approach.

“People want special workmanship, lovely dials, all handcrafted, they want something that is unique to them,” Gerzog said.