Swiss luxury watchmakers defy turbulent times
today Mar 25, 2011
March 24 - Everything appears to be going like clockwork for Swiss luxury watchmakers.
Japan's woes combined with unrest in the Middle East and North Africa have yet to dent booming sales or growth forecasts.
'Seamaster Planet Ocean' watch by Omega (Swatch Group)
And the mood among executives at the industry's annual get-together this week was upbeat and optimistic, defying expectations that world events would cast a pall over the fair where the bulk of the year's orders are placed.
But there is one thing worrying them.
Demand is so strong they are struggling to keep up.
Models by Tiffany & Co. (Swatch Group)
"We have huge backlogs and shortages," Marc Hayek, chief executive of Swatch Group's Blancpain, Breguet and Jaquet Droz, told Reuters. "Even leather straps can be difficult to get. We are missing all kinds of parts."
As a result, many are racing to invest in component manufacturers and strike deals to secure supplies as production bottlenecks spread throughout the industry.
Campaign for Swatch (Swatch Group)
Hayek's comments are all the more striking considering Swatch Group owns Switzerland's biggest components makers and regularly threatens rival brands it will stop supplying them.
By Astrid Wendlandt and Silke Koltrowitz
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