Swiss Watches

Breitling's clock is ticking

  • Why it matters

    Why it matters

    Switzerland’s grand tradition of independent, family-run watchmaking companies are slowly falling under the umbrellas of large luxury enterprises.

  • Facts


    • Founded in 1884, Breitling has been owned by the Schneider family since 1979 and employs 400 people.
    • In October alone, the volume of sales plummeted by 16.4 percent compared to the previous year.
    • Last year, the company known for its “pilot’s watches” produced exactly 147,917 timepieces.
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Day Two Of The 2014 Baselworld Luxury Watch And Jewellery Fair
A Breitling logo sits on the face of a Chronomat 41 Airborne wristwatch, produced by Breitling SA. Source: Gianluca Colla / Bloomberg

Luxury watchmaker Breitling could be running out of time. According to reports, the 132-year old Swiss heritage company is looking to be bought up.

Swiss daily Aargauer Zeitung reports that Breitling is being advised by an investment bank and while no decision has been made yet, a large luxury goods enterprise could most likely be the buyer.

A Breitling spokesperson declined to respond to Handelsblatts’ request for comment. “We do not want to make a statement concerning this rumor,” he said.

It’s not a confirmation, but also not a denial. Insiders are expecting the sales process to be made public as soon as buyers have been narrowed down.

Breitling is one of Switzerland’s last large independent luxury watchmakers. Headquartered in Grenchen, a small town at the foot of the Jura Mountains, the company designs and produces its own mechanical chronograph movements in La Chaux-de-Fonds. One of the company’s best customers is the military, which Breitling provides with onboard timepieces that can send out emergency signals.

Founded in 1884, the company has been owned by the Schneider family since 1979 and employs 400 people.

It wouldn’t be the first time that a traditional Swiss watchmaker has given up its independence. For a long time now, well-known brands like Tissot, Omega, and Longines have been owned by major Swiss watchmaker Swatch, while Tag Heuer, Zenit and Hublot are now a part of the French luxury giant LVMH’s empire (best known for Louis Vuitton). Meanwhile, Swiss watchmaker Richemont has control of the Cartier, Piaget and IWC Schaffhausen brands.




Consolidation has been underway for a long time. In general, it is becoming increasingly rare for family companies to stay at the helm of their luxury goods. Individual brands may retain their own space on department stores’ shelves, but behind the scenes production, distribution and management is cost-effectively split up under the umbrella of a corporate group.

You could say the timing of Breitling’s sale is bad. The Swiss luxury watchmaker is in a weak position, considering sales have been declining for months. In October alone, the volume of sales plummeted by 16.4 percent compared to the previous year. That was the company’s worst drop since the financial crisis seven years ago.

However, it seems there could be no other alternative. The Swiss watch industry is facing its fourth year of little to no growth at all. Jumps of 20 percent annual growth are a relic of the past. “The driving force is missing,” said André Bernheim, head of Mondaine, an independent watchmaker whose designs are inspired Swiss train station clocks. “All the important regions of the world are having problems – from the U.S. to Europe all the way to China.”

It’s not likely to be any better this year. Thousands of Asian tourists are hanging back from Europe after the terrorist attacks in Paris and Nice. Breitling is missing its Eastern buyers, who used to get expensive chronographs and take home a few more as souvenirs. “Breitling should have sold out a few years ago, when Swiss watch sales were still surging on a wave of Chinese demand,” said Andrea Felsted, an analyst at the Bloomberg news agency.

In addition, economic growth in China has tapered off. There is less money to throw around for pricey watches, for example. A major anti-corruption campaign is also making people wearier of status symbols. The strength of the Swiss franc certainly does not help.

Then there is also the new competition from the so-called smart watches, such as the Apple Watch. The armband devices display the wearer’s pulse rate, accept calls and access emails. Classic watchmakers were too late in taking this trend seriously.

Radical changes in the industry have already shaken one of the biggest. Swatch was forced to warn of a profit dive in July, publishing its bi-annual report a week early.

Profit fell as much as 60 percent in the first half and chief executive Hayek predicted a sales drop this year when he had previously seen a gain. Stocks slumped in response. Around two years go, Swatch shares were still at record levels around €475 ($503.8). Now they are only half of that. Alongside Europe, Hong Kong is a now particularly difficult market, commented Mr. Hayek.


Breitling opened two new retail stores this year in Switzerland. They are the watchmaker’s first shops in its home country.


Breitling however has comparatively few customers in Asia. “So we are now feeling the drop in demand less than the competition there, where the sales are falling off,” said the company’s vice president Jean-Paul Girardin in September.

Seeing a sign of the times, Breitling opened two new retail stores this year in Switzerland, where currency exchange isn’t an issue. They are the watchmaker’s first shops in its home country.

Last year, the company known for its “pilot’s watches” produced exactly 147,917 timepieces. Although the family company doesn’t reveal any other numbers, this one must be made public according to certification by the Official Swiss Chronometer Testing Institute. Mr. Girardin said back in September that there will be a similar number this year. By comparison, Swatch delivers several million a year.

Although sales numbers have declined industry-wide, sales at Breitling have hardly budged. René Weber, analyst at the private Swiss bank Vontobel, estimates that the firm’s sales last year were around 370 million Swiss francs ($364 million). For the current business year, Mr. Weber is reckoning with similar sales. So a sale right now could make sense – at least from the point of view of a potential buyer who is convinced the watch industry is in a trough. John Guy, analyst at Mainfirst Bank, figures the value of the company to be between 600 and 900 million Swiss francs.

Which leads to the question of who could be a potential buyer. Although rival Richemont has a good €5 billion in its war chest, according to Bloomberg analyst Ms. Felsted, the company is having its own troubles with luxury watches in its Piaget brand. Swatch is also sitting on a pile of money, but CEO Mr. Hayek alreadly lavishly bought up enough companies when the competitors first started suffering. LVMH, and the possibility of investment from the Middle East and Asia, have also been thrown around.

LMVH, for example, also has a watch division, which is thriving in comparison. “We have reached the bottom of the valley and in the second half year it’s going uphill again,” division head Jean-Claude Biver said. He is expecting to be in the black 2 to 5 percent in  exports, after having dropped by 11 percent Switzerland-wide between January and October. “2017 will be a better year, for the world and for our industry.”

Only time will tell.


Ozan Demircan is Handelsblatt’s correspondent in Switzerland. To contact the author:

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