ETA May Not Be Delivering Movements In 2020

[Tazmo61]

ETA may not be delivering movements in 2020 .


https://quillandpad.com/2019/12/15/b...atch-industry/

[Andy K]

Interesting.

That could lead to absolute ruin for smaller brands and independent watchmakers depending on ETA movements as the basis for their work.

Larger brands, who have meanwhile adjusted to the whims of both Swatch Group/ETA and Comco, usually no longer depend solely upon ETA movements to power their watches, preferring to purchase ébauches from a variety of sources these days. While for them this will be an inconvenience leading to lower 2020 turnover and perhaps fewer individual watch models, it will not put them out of business.

Smaller brands, however, may not be able to weather this storm.

The article doesn't give examples of the smaller brands that still rely solely or even mostly on ETA. Genuinely curious to know who they are. A lot has changed in the years since Swatch initially started down this path.

[sweets]

I agree, most people realised they would eventually get their wish when they tried before, so they have all switched to Sellita, Miyota and the like.
I see very few smaller brands making a point of fitting ETA any more.
They got their wish, and gave up a perfectly good, profitable business, so that they could allow their competitors to build up a larger, and more profitable business themselves. Way to go.
D

[markrlondon]

It does seem to be a bizarre situation.

And what about parts and repairs? It would be morally questionable to cut off parts supply to people to whom you have previously sold movements. So I wonder: Is parts supply included in this (alleged) cut off?

If this story is true then it offers a great opportunity for Sellita and others (including possibly new entrants) to increase production.

Also, 500,000 movements per annum doesn't seem like very much to me. I'm surprised it's so few. I'd have expected in the multiple millions.

[walkerwek1958]

Parts supply is already becoming a problem, wholesalers are no longer being supplied. I find the whole situation hard to understand, why not keep oarts availability as good as it used to be abd nake the profits selling the stuff?

Many Sellita parts are interchangeable but not all, which is v. frustrating.

[ped]

I thought Sellita still relied on ETA for some parts... not sure they could stand on their own at this point?

[walkerwek1958]

I thought Sellita still relied on ETA for some parts... not sure they could stand on their own at this point?

My understanding is that Sellita manufacture everything themselves. The patents have now run out on the common ETA movements (2824, 2892) so there's no reason why Sellita couldn't produce an exact copy. Having parts that aren`t interchangeable is a frustrating situation, the designs are identical.

One weakness with the 2892 is the train wheel bridge, which is a very lightweight construction and is prone to distorting when the centre seconds hand is fitted without supporting the bridge correctly. It only needs to be slightly distorted and the amplitude will plummet, the answer is to replace the bridge. They used to cost around £25, that's gone up to £42, my fear is they'll become non-available soon. Unfortunately the Sellita version doesn`t fit because the locating lugs (which play no part in the function) are different and so is the Sellita mainplate. I believe these differences were engineered in to keep ETA happy when Sellita manufactured under license prior to the patent expiring.

All movements haver an Achilles Heel somewhere, there are certain parts that are more likely to need replacement. 90% of the bits won't, but a few will, and that's where the problems arise when availability is restricted. I wouldn't trust parts from a Chinese clone even if they fitted, there's no guarantee of quality or consistency..........they have a bad habit of making parts from something slightly stronger than butter.

[earlofsodbury]

According to the article the issue is not (at this point) of Swatch/ETA's making, but rather the Swiss competition commission (Comco), who are being overly pedantic (whodathunkit?), in implementing an agreement intended to prevent an effective monopoly by ETA.

If the article's to be believed, the last-minute ban on sales results from a Comco poll of ETA's customers - which seems counter-intuitive...

Seems to me that if watch manufacturers run out of movements and parts, they will have only themselves to blame - they've had since 2013 to adapt.

[walkerwek1958]

Seems to me that if watch manufacturers run out of movements and parts, they will have only themselves to blame - they've had since 2013 to adapt.

With all due respect, this comment shows a lack of understanding of what’s involved in producing watch movements. A small manufacturer simply can’t afford the tooling/ production costs to do this, the old days of ebauche manufacturers are long gone, but mass- production was part of the industry for 100 years.

The way forward for most small manufacturers is to use Miyota or Seiko movements, I really don’t see what the Swiss gain from this. In the mid- late 70s they pulled together to save rheir industry, now rhey seem hellbent on killing large parts of it.

[earlofsodbury]

With all due respect, you are leaping to the assumption that this well-known fact has escaped me, wheras my implication was that ETA is not the only movement manufacturer. The most diverse and prolific - arguably. The most convenient for stuck-in-a-rut small makers - unquestionably ... and there lies the crux of the issue. If there is actually an issue (which remains to be seen), then they've had six years in full knowledge of Comco's intentions to seek supply from elsewhere, and if they haven't, or if other movement manufacturers have failed to scale-up production, then, as I said - they have only themselves to blame.

[ped]

I must admit I do find it a bit boring when manufacturers use the same movements. You’re basically reduced to being a case and dial manufacturer. It would be nice to see companies develop their own movements.

[robt]

I must admit I do find it a bit boring when manufacturers use the same movements. You’re basically reduced to being a case and dial manufacturer. It would be nice to see companies develop their own movements.

There is already a trend in this direction but I'm not sure it's a good thing for the most part. It would be great if there was significant competition pressure to push the envelope on accuracy, shock resistance, wear resistance, etc., so that we get better and better movements. But that doesn't seem to be what is happening. Market pressures that would make that happen haven't existed since the 70s.

Instead there is a movement towards more diversity of very similarly-specced but incompatible movements that can really only be serviced by the OEM. As well as pushing up service costs (and potentially creating more watches that will be completely non-serviceable in 20 years) it creates artificial scarcity and de-commoditisation, both of which cause an upward pressure on prices without a corresponding increase in value. Watch makers are certainly not oblivious to these "unintended consequences".

OTOH, I am all for more diversity in well-supported movements from the likes of Sellita, Miyota, Seiko and ideally many more. ETA should be part of that mix, so there is level competition between movement makers, quite separately from choice of cases, dials, etc. The right way to solve the ETA monopoly would have been to force ETA to invest some of their income into Sellita, much as Microsoft did with Apple back in the 90s, rather than to restrict supply to pre-existing customers. I am less concerned about the restriction of new movements, but the restriction of parts to repairers is absolutely insidious. It essentially reverts the unwritten contract of sale for anyone who bought an ETA-based watch, which is that the movement is reliable, well-proven and it is easily serviced because parts are plentiful.

[ped]

I agree from an economic standpoint but I’d rather have an ‘in house’ movement which costs more to service by the manufacturer than a drop in third party one, even if the manufacturer made one is less advanced - I feel the same about car engines, having more respect for a brand who design and make their own engines rather than drop in something. It also annoys me when manufacturers use the same platform and we end up with cars that all look the same. Same with watches that have the same date locations, subdial placements, case sizes, power reserves, complications... I’m not into watches for efficiency and ease of use, reliability or technical ability. I like the artisanal aspect, supporting independents and the individuality which I feel is now missing from most brands who have hitched their wagon to ETA. Unfortunately, like the car industry, the whole thing is towards efficiency and branding which is the polar opposite of what I enjoy about watches and why I tend to prefer vintage pieces.

But I completely understand and see your point for the vast majority of the population and the employees and shareholders.

[robt]

I agree from an economic standpoint but I’d rather have an ‘in house’ movement which costs more to service by the manufacturer than a drop in third party one, even if the manufacturer made one is less advanced - I feel the same about car engines, having more respect for a brand who design and make their own engines rather than drop in something. It also annoys me when manufacturers use the same platform and we end up with cars that all look the same.

I largely agree with you although this is what ebauches are supposed to be for. It's a lot better for everyone is the parts themselves are interchangeable and then OEMs can just increase or decrease the spec & price on individual models, move subdials around to fit the design, etc.

Compare with PCs: there are a few standard form-factors like ATX, ITX and so on, a few standards for components like PCI, SATA and so on but then out of that you end up with huge diversity of the PCs, which are almost all upgradeable and repairable by the owner, never mind independent specialists. It's not just diversity of specs either: I've got one huge ATX box with 32 CPU cores that contrasts with an Alienware Alpha gaming console I have in my living room. The latter is smaller and sleeker-looking than a PS4, yet it's still just a standard mini-ITX PC in a custom case. Many of the parts from the massive PC will fit in the tiny one because everything that can be made small already was during standardisation. The fact that there are only, I think now 3, companies capable of manufacturing hard drives, has in no way caused interoperability or repairability problems for computers with hard drives. Quite the opposite in fact.

I would love to see more manufacturers coming up with e.g., thinner movements without sacrificing performance or reliability. That's how we get to "not everything looks alike" in a truly meaningful sense. However, very few of them are actually doing that. It's really only the ones who have traditionally done that, like JLC, carrying on as always. What concerns me is the replacement of very standard ETA movements in the mid-range market with more-diverse-but-actually-all-the-same in-house movements, which isn't good for anyone except a few shareholders.

The problem as I see it is that the market is following Rolex and while Rolex have actually made measurable improvements to their movements in terms of accuracy compared to COSC, typical service intervals, etc., that's not really the reason most people buy Rolex. Hence the rest of the market isn't following that aspect, because market forces aren't pressuring them to do that. Market forces are pressuring them to "differentiate" which doesn't necessarily mean better quality or value. It mostly just means better marketing. The terms "in house" and "limited edition" being the two biggest trends in watch marketing over the last 5 years or so.

[Kallang]

It would be a shame if this raises the age old ebauche vs in-house debate again. Ebauche production and use was one of the defining hallmarks of the Swiss watch industry in its golden age. The Swiss watch industry was built on easy and mass production of parts to an efficiency that the handcraft artisans in England and France could no longer keep up and perished. As one monster eats another. The true wonder of Swiss watchmaking craft is in its mastery of continuous diminution in quality partnered with ever growing prestige in perceived luxury. Maybe the difference then was there was a plurality of ebauche producers to choose from whereas for a long time since the quartz revolution there was only one.

What also needs explanation is whether the Swatch companies that provides cases, jewels, hands, hairsprings and balances to firms will come under a similar directive. WatchPro has an article saying Nivarox has an agreement to continue selling until 2023. Who knows what will happen then?

[MrGrumpy]

I agree from an economic standpoint but I’d rather have an ‘in house’ movement which costs more to service by the manufacturer than a drop in third party one, even if the manufacturer made one is less advanced - I feel the same about car engines, having more respect for a brand who design and make their own engines rather than drop in something. It also annoys me when manufacturers use the same platform and we end up with cars that all look the same.

But the difficulty is, with cars certainly and I assume with watch movements, that the R&D / development / production cost setups for a new in-house engine / movement are too enormous for anyone but the biggest independent. It would be just impossible for microbrands to exist if they had to produce everything themselves, unless they could charge £100,000+ for a watch (or car). If you wanted to setup a micro-brand then the ability to get something to market by using someone else's proven technology is not just attractive to the brand (and possibly reassurance to potential buyers of an unknown brand), it is just the only possible way.

[ped]

But the difficulty is, with cars certainly and I assume with watch movements, that the R&D / development / production cost setups for a new in-house engine / movement are too enormous for anyone but the biggest independent. It would be just impossible for microbrands to exist if they had to produce everything themselves, unless they could charge £100,000+ for a watch (or car). If you wanted to setup a micro-brand then the ability to get something to market by using someone else's proven technology is not just attractive to the brand (and possibly reassurance to potential buyers of an unknown brand), it is just the only possible way.

Don’t get me wrong - an ETA or Seiko movement in a £600 micro brand - no problem (until possibly now, yeah!) But it does bug me when a £3k watch uses a movement found in those same watches and the rest is called marketing. Tbh I wish ETA would form a watch company for their movements then let companies like Longines produce amazing movements again but I fear that’ll never happen.

[ped]

A good example is perhaps Oris - developing their own base movement and continuing to add functions (cal. 110,111,112 and it goes on) and the watches aren’t too expensive either, other companies sell ETA powered watches for a similar price. Which I think is lazy, boring and a lot of money to spend on a case/dial/handset

[walkerwek1958]

There are good reason why the industry consolidated around the ETA movements following the quartz crisis in the 70s. The movements are excellent designs, they're simple, they're cheap to mass-produce, and the performance is impressive. Apart from the need to be different there simply isn`t a logical case for anyone developing anything different from an ETA 2824 or 2892. These movements did the job impressively and they still do, if we take away the subjective warm fuzzy feeling around in-house movements there really is no need for anything better. I still think the 2892 could've been further developed with a free-sprung balance in the way Omega did with the 2500 series co-axials, but the added complexity and difficulty in servicing probably isn`t worthwhile for the marginal improvements achieved.

People decry these movements, they shouldn't. I have a TAG in pieces at the moment with a 2892 movement and even after years of use and neglect its in surprisingly good condition.

We've progressed from a situation where the industry was happy with ETA movements, ETA were happy to produce them, watches using these movements were available at all price ranges, repairers could get parts easily and cheaply to fix them, everyone was happy. Now we've got the opposite and no-one's happy......it defies logic to me.

[ped]

....there simply isn`t a logical case for anyone developing anything different from an ETA 2824 or 2892.

Logically, no. But logically we should all be wearing quartz watches. From an economy sense, as explained above, I completely get it - but as a consumer who loves cars and watches, I feel both are approaching the 'white goods' end of the scale.

[walkerwek1958]

Logically, no. But logically we should all be wearing quartz watches. From an economy sense, as explained above, I completely get it - but as a consumer who loves cars and watches, I feel both are approaching the 'white goods' end of the scale.

From a man who fixes the things this might sound strange, but I think people get too hung up on the movements. Sure, I like some of the older vintage ones, there was more of a sense of craftsman ship and design, and in some cases the parts were higher quality too, but I accept that those days are all but gone.

When I look for a watch it’s 99% about the look and style, provided it doesn’t contain something horrible I’m not too fussy about the movement used. The differences in performance are relatively small and are often overshadowed by how well the watch has been regulated. The quality of the rest of the watch is something I relate to more than the movement.

I firmly believe that a good watch is greater than the sum of its parts. Sometimes I work on stuff that initially I don’t like, often because they’re in poor condition, but after a full dose of sorting out I see the watch in a totally different light and start to ‘get it’. The TAG Kirium on my bench is in that category, not a watch I was keen on and this is a well- worn example, but as I’ve worked on it I’ve been v. impressed with all aspects of the quality. The movement’s an ETA 2892 and it’s responded v. well to servicing plus a couple of replacement parts. After a full refinish the watch absolutely pops, I totally ‘get’ the style because it looks as intended rather than a scratched- up mess. Love it or loathe it, the watch has a certain style and my opinion wouldn’t be swayed by the movement. TAG do one thing I dislike and that’s the use of plastic movement rings instead of going the extra mile and using metal, otherwise the watch gets 10 out of 10 from me and it shows how good TAG can be.

I think the situation back in the early 2000s was healthy, lots of watches powered by ETA movements at sensible prices, with good parts availability and support. I don’t see the development of new in house movements as a step forward in all cases, and I doubt whether any can beat the ETA stuff for reliability and longevity.

Here’s a snippet of trivia: an ETA 2892 uses only 14 screws in the whole movement.......that’s not a lot! To me it’s another reflection of how well- designed and thought out these things are, a design classic in my opinion.

[chrisparker]

It seems like the Swiss watch industry is hell bent on destroying itself from within.

The most prestigious brands can’t or don’t seem to want to get their watches to customers. The biggest movement manufacturer isn’t allowed to sell their movements to smaller brands. And any worthwhile new release is a re-edition inspired by the past.

Meanwhile in Asia they’re innovating, and growing market share. The Swiss need to get their act together or face a second ‘quartz crisis’ which will be almost impossible to recover from.

[earlofsodbury]

Seems there's been a one year stay-of-execution...

https://www.nau.ch/amp/news/wirtscha...r-eta-65630937

Quite what will happen in one year, that hasn't happened in the previous six remains to be seen...

[Normunds]

I got a letter from swatch group, interesting read.

COMCO’s dictate harms the Swiss watch industry

Biel/Bienne (Switzerland), December 18, 2019 - The Competition Commission (COMCO) wants to prohibit Swatch Group or its subsidiary ETA from supplying mechanical movements to third parties in 2020. COMCO has always obligated ETA to supply its customers with movements and now it intends to prohibit it from doing so for the whole of 2020.

The provisional measures adopted by COMCO are incomprehensible and unacceptable. Above all, they are unnecessary because the situation in the market for Swiss Made mechanical movements has changed drastically since the settlement of 2013. Furthermore, they reinforce the positioning of a new dominant player.

With its decision, COMCO is also interfering in economic policy and is restructuring the entire Swiss watchmaking industry. In doing so, it is exceeding and violating its authority. In view of the negative financial repercussions that these decisions will entail, Swatch Group reserves the right to claim damages. Swatch Group requests that the settlement reached in 2013 be terminated as planned on 31 December 2019.

Inexplicably, these provisional measures are based on a false and outdated premise. Since the signing of the settlement between COMCO and Swatch Group in 2013, the market for mechanical movements in Switzerland has changed fundamentally: ETA is no longer the market leader in this sector. Due to the settlement reached in 2013 and the will of Swatch Group, production volumes and capacities have been reduced year after year.

At the same time, other players significantly increased their own production levels and, as in the case of Sellita, far exceeded those of ETA. In 2019, Sellita produced and supplied one million mechanical movements (roughly twice as many as ETA), making it the new market leader in this sector. Accordingly, customers are no longer dependent on ETA. It is absurd and unacceptable, given the new situation, that COMCO is now completely prohibiting ETA from supplying its customers with movements. The provisional measures have no legitimacy. The prerequisites for a delivery ban have not been met.

With its decision prohibiting ETA completely from making deliveries to third parties in 2020, COMCO is effectively driving ETA out of the market (exceptions for SMEs are stipulated in theory, but de facto impossible). On the other hand, Sellita will become an even more dominant player due to its production volume. COMCO has thus reshuffled the cards for the industry and is, in effect, making economic policy by completely restructuring a strategic market area. However, this contradicts its mission and its authority. One of COMCO's mandates is precisely "the prevention of state restrictions on competition". In this case, however, it has created such a restriction itself and is giving even more clout to an already very dominant player.

It is also very surprising that the main arguments for these provisional measures are fully in line with the wishes expressed by Sellita in the course of the proceedings. The terms used by COMCO in its official communication correspond, practically word for word, to those used by Sellita. This raises the question of whether the COMCO Secretariat can be influenced – or is even already under outside influence – and whether it still takes its decisions completely independently.

The timing of the decision is also problematic. The COMCO Secretariat apparently took neither the urgency of the dossier nor the planning timeframe into account. However, the deadline set at the end of 2019 has been known to COMCO for six years within the framework of the settlement. Swatch Group has repeatedly tried unsuccessfully to draw COMCO’s attention to the urgency of the situation and has insisted on the absolute necessity for the Commission to take a definitive position on this matter. Swatch Group officially called COMCO’s attention to the matter no fewer than six times between September 25, 2018 and August 27, 2019. Other players in the watchmaking industry have also warned COMCO in view of the approaching deadline. In vain.

Not only for Swatch Group but also for all its customers – whether larger companies or small and medium enterprises (SMEs) – it was extremely important to know what would happen in this matter and whether and in what quantities they could purchase mechanical movements. For planning reasons alone. COMCO’s decision, and this is just a provisional measure, will officially be announced only tomorrow. This means only 12 days before the end of the year. From an industrial point of view, this is absurd.

How is it possible to plan and prepare seriously for the 2020 financial if COMCO suddenly decides at the end of 2019 to change the previous conditions fundamentally by prohibiting ETA from supplying its customers? Swatch Group and its customers generally plan their future production twelve months (or more) in advance. It is customary to place orders for movements no later than the 30th of June for the following year, which COMCO itself acknowledges. We would like to point out that Swatch Group has always stressed that it intends to continue its deliveries beyond the end of 2019, choosing its own customers. The other players in the watch industry who expect ETA products to equip their watches in 2020 are now in a very complicated position. Starting with SMEs, which ETA cannot supply due to COMCO’s dictates. But how can a watch be sold without a movement?

What will tomorrow bring? In addition to the many obstacles that COMCO has imposed on the industry for 2020 - with repercussions until 2021-22 due to delivery deadlines - uncertainty will prevail for many months and investments will be slowed down. The Commission is unlikely to take a final decision on this sensitive matter of mechanical movements until sometime in 2020. At this stage, COMCO has not yet announced any timetable.

[markrlondon]

Meanwhile in Asia they’re innovating, and growing market share. The Swiss need to get their act together or face a second ‘quartz crisis’ which will be almost impossible to recover from.

I suspect that all successful industries destroy themselves eventually.

It just makes me sad that UK watchmakers are unable to innovate in the way that Chinese and others do. It seems to be due to lack of capital and/or lack of risk-taking mindset.

[markrlondon]

I got a letter from swatch group, interesting read.

Very interesting reading.

I have to say that it does seem to have a whiff of hypocrisy since, as I understand it, it was originally Swatch/ETA who in effect raised the issue of cutting off supply. Well, they're getting their wish -- albeit after they have decided they don't want it!

At the same time, other players significantly increased their own production levels and, as in the case of Sellita, far exceeded those of ETA. In 2019, Sellita produced and supplied one million mechanical movements (roughly twice as many as ETA), making it the new market leader in this sector.

This really does surprise, both because ETA's sales are so low and because Sellita's are so high in comparison. That's not how I'd have expected it to be.

I can only imagine that not a few microbrands who say they have ETA movements might be selling Sellita movements.

[earlofsodbury]

... lack of risk-taking mindset.

This is an important element, but it's also a lack of culture in their home nation. Like most Brits I grew up thinking we were a terribly cultured nation, but spending significant time in mainland Europe and further afield as an adult, I came to realise we are the same old barbarians we always were - or rather that fewer of us per-capita are interested in the more cultivated and refined interests more popular in places like Germany, Holland, Denmark etc. Even Iceland can show us the way.

This impression was strongly reinforced as I spent some years working in the weird-and-wonderful(ish) world of high-end hifi, something for which there's barely a market in the UK, while it thrives and proliferates in Germany, the US, Japan, and even China and India.

We also love to stereotype Scots and Yorkshiremen as "tight-fisted", but Brits as a whole are incredibly penny-pinching compared with our neighbour-nations, plus have no grasp of things like import costs etc.

[markrlondon]

I'm not sure I agree with all of that, but...

We also love to stereotype Scots and Yorkshiremen as "tight-fisted", but Brits as a whole are incredibly penny-pinching compared with our neighbour-nations, plus have no grasp of things like import costs etc.

...this bit is relevant imo. This tight fistedness is evidenced by the lack of investment capital and/or lack of risk taking mindset to which I referred. It is in my view a national weakness that is demonstrated at all levels, from small to large.

This mindset also reflects itself, in a manner, in larger, more successful businesses: There is a 'sell out' attitude rather than the 'continue to build up and acquire' mindset that other countries seem to have.

[earlofsodbury]

I'm not sure I agree with all of that, but...

Indeed, I appreciate I'm generalising to an audience who will largely be an exception to it!

...this bit is relevant imo. This tight fistedness is evidenced by the lack of investment capital and/or lack of risk taking mindset to which I referred. It is in my view a national weakness that is demonstrated at all levels, from small to large.

This mindset also reflects itself, in a manner, in larger, more successful businesses: There is a 'sell out' attitude rather than the 'continue to build up and acquire' mindset that other countries seem to have.

Couldn't agree more!

[MrGrumpy]

This mindset also reflects itself, in a manner, in larger, more successful businesses: There is a 'sell out' attitude rather than the 'continue to build up and acquire' mindset that other countries seem to have.

Sorry, I know we are going well OT here! You may well be right, but there is also the legal environment to consider. In the UK, if you are a plc, its more or less impossible to fight off a takeover bid from another, or foreign, company, so some of the time, the only thing to do is fight for a good deal. In other countries, notably Germany, ownership rules are much stricter and foreign takeovers are much more difficult. However, you are right that there definitely is a culture of growing the business in Germany especially, with a much higher proportion of companies that remain privately owned and not plcs. All this explains why German companies have invested for the long term and have become world leaders, whilst there are hardly any British owned companies (as opposed to brands) of note left.

[markrlondon]

there is also the legal environment to consider. In the UK, if you are a plc, its more or less impossible to fight off a takeover bid from another, or foreign, company, so some of the time, the only thing to do is fight for a good deal.

I'd say that this reflects the national attitude to which I referred.

Note that controls or limits on foreign takeovers are not necessarily needed: The problem here is attitude. Rules and regulations don't change attitude and can always be gamed, if need be. It is the attitude that is the problem: In other words, if a business (whether privately owned or publicly owned) is a good takeover target, then why isn't it British buyers trying to buy it!?[1]

Well, that's a rhetorical question: The reason as ever is: Lack of relatively easily available capital, together with symbiotically linked lack of risk taking attitude, which is further symbiotically linked with a sell out attitude over an acquire and build long term wealth attitude.

It is a change of attitude that is needed, not rules and regulations.

I think that British people and British businesses did once have this long term growth attitude but at some point they lost it in favour of short termism, lack of follow through, and lack of proper planning.

Now, please, no one be so naive as to blame capitalism. There is nothing whatsoever in capitalism that favours short termism over longer term investment and planning. Indeed, the greatest return on capital (rather than present year income) is usually gained by investing for the long term.

We (that is the British people as a whole) need to return to our roots of what I call real capitalism, real investment, and a long term view to building wealth, influence and power.




Footnote:-
1: A recent example was the attempted take over of the London Stock Exchange by Deutsche Boerse. What the frag!? Why would it not have been, why should it not have been, the other way round? because the British attitude was to sell out and thus lose out on long term wealth, growth, influence and power whereas the German attitude was to acquire and thus gain long term wealth, growth, influence and power. This purchase has been called off buy why isn't the LSE now trying to buy its competitors?

A similar issue was seen with the proposed 'merger' of BAE Systems with EADS. I cannot imagine anything so stupid and damaging to the strategic resilience (at several levels, commercial, economic and political) of the UK that such a merger would have been. Happily it did not go forward.

See also energy companies and similar formerly UK state-owned utilities. Lost opportunities for the UK.

See also a distinct lack of a UK sovereign wealth fund.

[MartynJC (UK)]

I wonder how this affects the likes of Breitling, IWC and others, who still use ETA movements as a base for their watches? It is not just the SME affected.

[MrBanks]

I wonder how this affects the likes of Breitling, IWC and others, who still use ETA movements as a base for their watches? It is not just the SME affected.

Breitling and IWC use Sellita.

[MartynJC (UK)]

Breitling and IWC use Sellita.

Er - no - B17 is ebauche ETA 2824-2 (for example)

https://watchbase.com/breitling/caliber/b17

still used in their current models: https://www.breitling.com/gb-en/watc...A17331101B2A1/

[robt]

TIL that the Chinese have cloned the ETA 2824-2 as well:

https://www.watchgecko.com/what-is-t...atch-movement/

I wonder if it is a 100% parts-level compatible clone unlike the Sellita and whether the manufacturing tolerances & finish quality are comparable.

[MrBanks]

Er - no - B17 is ebauche ETA 2824-2 (for example)

https://watchbase.com/breitling/caliber/b17

still used in their current models: https://www.breitling.com/gb-en/watc...A17331101B2A1/

Have you opened the back of a B17 to check the movement? If not then I'd probably not rely on Watchbase as a source of information.

[MartynJC (UK)]

Have you opened the back of a B17 to check the movement? If not then I'd probably not rely on Watchbase as a source of information.

Have you? I haven’t one in my collection at present - but here is a link to a picture of one and description relating to ETA.

http://www.donindiano.net/watches/br...n/b17_movement

and other mentions of the B17 ebauche is ETA 2824-2 are at:

https://console.fm/category/breitlin...cean-heritage/

https://www.breitlingsource.com/details/B17.html

i am hoping others with direct knowledge (of repairing a B17 movement) will chip in? I gather knowledge - but am not a watchmaker myself.

So how will Breitling and IWC deal with removal of their base ebauche?


Martyn

[RustyBin5]

I posted this on a new thread earlier today. Didn’t know this one existed. Looks like Swatch are appealing the ruling. ETA may not be quite on the way out just yet...

https://usa.watchpro.com/swatch-grou...nts-to-rivals/

[xellos99]

I would be happy with the Soprod movements. Better than ETA from what I read.

[RustyBin5]

I would be happy with the Soprod movements. Better than ETA from what I read.

Steinharts with eta have never had any issues that I know of. They did use a couple of soprod movements for a while and they did suffer quite a few problems with it. Not sure why.

[earlofsodbury]

Latest development in this seemingly-eternal saga...

Swatch Group’s ETA has been cleared to supply movements to any other watch brand in a reversal of its position by Swiss competition watchdog WEKO.

In a complete victory for the company, the only limit on its freedom is that WEKO says it will not be allowed to abuse its dominant market position by undercutting rivals’ prices...

Quite what it's going to mean in practice you have to wonder - lot of companies have sourced alternative or even ramped-up their own manufactory movements...

[robt]

Quite what it's going to mean in practice you have to wonder - lot of companies have sourced alternative or even ramped-up their own manufactory movements...

Wasn't that the original idea: not to restrict ETA into a closed-off monopoly but to break their monopoly and ensure some kind of strong competition exists, which it now does. I think people are reasonably happy with a Sellita movement instead of ETA these days and making more ETA movements available isn't going to cause everyone to just dump Sellita now. Hopefully it'll generate real market pressure in the form of lower prices and more innovation on the higher end from both sides.

I'm not 100% convinced this will actually happen though. Two companies do not a free market make. There's even a word for it: duopoly. Although it's not a real duopoly because there's already competition from Japan and China.

I have followed closely the very similar dynamic between Intel and AMD over the years (where you could say Arm represents Asian movements in this analogy). It's had its fits and starts and with stronger competition, computer technology could probably have advanced even further and faster than it has. But there have been some occasionally big market swings between these two players over the years that have really forced the other one to innovate. We're in the middle of one right now. After about a decade of complete dominance by Intel, things have shifted very dramatically against them with AMD absolutely destroying Intel's hold on the top-end CPU market with Threadripper. Meantime, Apple and AWS are investing heavily in Arm, putting even more pressure on Intel. It could be the end for Intel, but they've come back from similar situations before. It'll be interesting to see how it plays out.

So there you go. Maybe something similar will happen in the watch movement market as the CPU market. I suspect it won't though. The same competitive pressures are not there. Watchmakers are probably more interested in long-term serviceability than in pushing the envelope for performance, or lowering prices (as margins on watches are astronomical compare to the PC business). Things like the standard of decoration, customisability and supply of ebauches are perhaps the main areas where there will be some real competition, given the trends in the watch market (more "differentiation" through things like in-house and quasi-in-house movements; higher prices through less commoditisation; more "limited editions", artificially limited supply, etc).

[RustyBin5]

Wasn't that the original idea: not to restrict ETA into a closed-off monopoly but to break their monopoly and ensure some kind of strong competition exists, which it now does. I think people are reasonably happy with a Sellita movement instead of ETA these days and making more ETA movements available isn't going to cause everyone to just dump Sellita now. Hopefully it'll generate real market pressure in the form of lower prices and more innovation on the higher end from both sides.

I'm not 100% convinced this will actually happen though. Two companies do not a free market make. There's even a word for it: duopoly. Although it's not a real duopoly because there's already competition from Japan and China.

I have followed closely the very similar dynamic between Intel and AMD over the years (where you could say Arm represents Asian movements in this analogy). It's had its fits and starts and with stronger competition, computer technology could probably have advanced even further and faster than it has. But there have been some occasionally big market swings between these two players over the years that have really forced the other one to innovate. We're in the middle of one right now. After about a decade of complete dominance by Intel, things have shifted very dramatically against them with AMD absolutely destroying Intel's hold on the top-end CPU market with Threadripper. Meantime, Apple and AWS are investing heavily in Arm, putting even more pressure on Intel. It could be the end for Intel, but they've come back from similar situations before. It'll be interesting to see how it plays out.

So there you go. Maybe something similar will happen in the watch movement market as the CPU market. I suspect it won't though. The same competitive pressures are not there. Watchmakers are probably more interested in long-term serviceability than in pushing the envelope for performance, or lowering prices (as margins on watches are astronomical compare to the PC business). Things like the standard of decoration, customisability and supply of ebauches are perhaps the main areas where there will be some real competition, given the trends in the watch market (more "differentiation" through things like in-house and quasi-in-house movements; higher prices through less commoditisation; more "limited editions", artificially limited supply, etc).

I think the fact that the design for the ETA movements no longer have any protection and are free to be cloned in the public domain now without fear of reprimand has a lot to do with it

[kneadking]

I am hoping that this will make delivery times of movements by giving watchmakers another source of supply and making deliveries of watches to customers more reasonable. I know that Eddie was having no luck with sourcing ETA movements making wait times a real issue from Sellita as demand has sored over the past several months.

[200mwaterresistant]

Fascinating reading and new information to me. I'd followed previously Cousins in the UK taking swatch group to court in Switzerland over the course of the last 2-3 years to force them to make parts available outside of Swatch group, I was unaware that some external organisation had bound them over not to sell movements (if I'm understanding the situation correctly).

How are these 2 things related yet not part of the same story?

[KAS118]

I think its a good thing - as some movement, such as no-date small sub-seconds, aren't readily available.

However. I also hope that watch manufactures (and microbrands) do look at the other movements that are becoming available - such as The Soprod Newton and the Ronda R150; the thought of every watch basically having the same ETA movement is a b it boring - whereas I enjoy owning different watches powered by different movements

[Dougal]

I may be late to the ETA party, but belatedly saw this update: https://www.hodinkee.com/articles/sw...movements-case

But it doesn’t impact Cousins’ court case, does it?

[stefmcd]

I agree, most people realised they would eventually get their wish when they tried before, so they have all switched to Sellita, Miyota and the like.
I see very few smaller brands making a point of fitting ETA any more.
They got their wish, and gave up a perfectly good, profitable business, so that they could allow their competitors to build up a larger, and more profitable business themselves. Way to go.
D

Lol. Yeah, it's what everyone would least expect, do let's do it!

Sent from my CLT-L09 using TZ-UK mobile app

[earlofsodbury]

I may be late to the ETA party ...

Five months to be exact.

[Dougal]

Five months to be exact.

It could be the Christmas cheer(s)

But I'm blaming the lack of a perpetual calendar in my collection