Friday, September 25

Opinion: Breaking news of Rolex, Patek Philippe, Chanel, Chopard and Tudor leaving Baselworld

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This just in, perhaps you may have already seen it elsewhere, but we will cover it here. Rolex, Patek Philippe, Chanel, Chopard and Tudor leaving Baselworld. We also give you our initial reactions to seeing this news as it breaks.

Press Release with commentary in italics.

Rolex, Patek Philippe, Chanel, Chopard and Tudor leave Baselworld to create a new watch trade show in Geneva with the Fondation de la Haute Horlogerie. The show will be held early April 2021 at Palexpo, at the same time as Watches & Wonders. This departure follows a number of unilateral decisions made without consultation by Baselworld management, including the postponement of the watch show until January 2021, as well as its inability to meet the brands’ needs and expectations.

This is major. We note that this decision to depart is due to the big brands being unhappy with the decisions made by Baselworld management. The withdrawal of the majors – of note, Rolex, Patek Phillipe and Chopard may be the signature on the death warrant of Baselworld. As we understand it, MCH, who manages Baselworld offered to retain 15% of 2020 fees to keep the business going, and retain 85% as down payment for 2021.

This is also the first mention that Watches & Wonders will be held in early April 2021 in Palexpo, Geneva.

The new show, which will be linked to Watches & Wonders, organized by the Fondation de la Haute Horlogerie, is to take place at Palexpo. The aim is to offer partner brands the best possible professional platform, applying a shared vision to successfully meet future challenges in the watchmaking industry. It will also give crucial prominence to the sector’s expertise and innovations, both in Switzerland and internationally.

Baselworld | Closing Press Conference, April 2019.

Other brands may also be added, according to terms that have not yet been defined. This new event will be geared predominantly towards retailers, the press and VIP customers.

Rolex and Tudor

“We have taken part in Baselworld since 1939. Unfortunately, given the way the event has evolved and the recent decisions made by MCH Group, and in spite of the great attachment we had to this watch show, we have decided to withdraw. Following discussions initiated by Rolex, it seemed only natural to create a new event with partners that share our vision and our endless, unwavering support for the Swiss watchmaking sector. This will allow us to present our new watches in line with our needs and expectations, to join forces and better defend the interests of the industry.”

Jean-Frédéric Dufour, Chief Executive Officer, Rolex SA, and Board Member, Tudor

It looks like Rolex took the lead to gather the big boys to depart the show.

Patek Phillippe

“The decision to leave Baselworld was not an easy one to take for me, being the fourth generation of the Stern family to participate to this traditional yearly event. But life evolves constantly, things change and people change as well, whether it is at the level of those responsible for the watch fair organization, the brands or the clients. We constantly have to adapt ourselves, question what we do, since what was right yesterday may not necessarily be valid today!

“Today Patek Philippe is not in line with Baselworld’s vision anymore, there have been too many discussions and unsolved problems, trust is no longer present. We need to answer the legitimate needs of our retailers, the clients and the press from around the world. They have to be able to discover the new models from Swiss watchmakers each year, at one time, in one place, and this in the most professional manner possible.

“That is why, following several discussions with Rolex and in agreement with other participating brands, we have decided to create, all together, a unique event in Geneva, representative of our savoir-faire.“

Thierry Stern, President, Patek Philippe
SIHH 2019.

And once, the King and Queen have decided, the death warrant is signed. Other major players followed, with Chopard in the lead. Karl-Friedrich Schuefele has been a staunch supporter of Baselworld, and his disappointment was apparent in his statement:

Chopard

“Chopard first exhibited at the Basel fair in 1964 with a stand of some 25 square metres. After careful consideration, our family decided to support
the Rolex initiative and retire from Baselworld – a painful decision. The creation of this new watch show in Geneva, in parallel to Watches & Wonders, will allow us to better serve our watchmaking partners and our customers. Through the alliance, these grandes maisons will also be able to collaborate in promoting the values and best interests of Swiss watchmaking.”

Karl-Friedrich Scheufele, Co-President Chopard et Cie SA

Chanel

“Like its partners, Chanel shares the same independence and the same desire to protect and promote the values, know-how, utmost quality
and precision of Swiss Watchmaking. This initiative marks a key milestone in the history of Chanel Watchmaking and is part of a long-term strategy, which began with the launch of this activity in 1987. This exhibition will allow us to present all of our new creations in an environment that meets our high-quality standards.”

Frédéric Grangier, CEO of Chanel Watches & Fine Jewellery

Now it remains to be seen when, if the LVMH Group will join the new event in Geneva. In a conversation with Jean-Claude Biver in 2018, while discussing the departure of The Swatch Group from Baselworld, I asked him if he would consider becoming part of SIHH. His response surprised me a bit. He told me that he had applied to admit Hublot, TAG Heuer and Zenith to SIHH, but have been rejected twice before. It will be interesting if the group, with or without Bulgari, joins this new event.

We are also curious if Georges Kern will remain outside the big shows, or will join one of them. I reached out to him, perhaps its early days yet, but his response is perhaps telling: “Will see”.

“The Fondation de la Haute Horlogerie is delighted to welcome a new salon which will strengthen the historical Watch & Wonders event in Geneva next year in early April.”

Jérôme Lambert, on behalf of the Fondation de la Haute Horlogerie Council

We are also curious if The Swatch Group will join this new event, retain their Time to Move, or if the MCH management will find a way to persuade them to return to Baselworld. This is life and death mission for MCH management. If they fail, it will be their demise.

And if Baselworld collapses, and ceases, the independent watchmakers will have to find a new place to show their craft. I spoke to Bart Grönefeld just a moment ago, and as they were planning to do both shows for this year, they will now focus on just on W&W. I also spoke to Max Büsser of MB&F, and he was shocked to hear the news, though it will not impact him as he had originally planned to show at SIHH 2020, and hence will be there for W&W 2021.

But we don’t quite know yet the impact to other independents. For their sakes and ours, I hope they will find a home to showcase their talents.

Concluding thoughts

“This move may have a huge impact on the industry at 3 levels: MCH, all brands, and the industry. If there is no compromise between the brands and Baselworld, the industry will suffer. Without an esprit de corps during these bad times, what credibility would the product of category of watches and its actors be in the eyes of consumers? The industry will be heading for bad times if joint efforts among the brands cease. The likes of The Swatch Group, Rolex, Patek Philippe, Richemont, LVMH, Kering etc. will survive. But might this lead to a reduction offerings which are creative, diverse, and emotional enough to please customers?

“The danger is that brands reduce investments into human relationships to a degree that end customers lose touch with the industry – with only hard core bargain hunters remain.

“Perhaps it is tunnel vision of a decaying industry. The stagnant numbers tell that story. I hope that the important decision makers of the major players will sit together to agree on joint short, mid and long-term actions to promote the industry as a team and not singular brands. Leverage on synergies to propel the industry to the next phase wouldn’t be a bad move for a change.

Dr. Frank Muller, The Bridge to Luxury and Special Correspondent to Deployant.
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