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Swiss watches are considered emblematic of quality and precision as well as the punctuality that is often associated with them. As an established mark of quality, the label "Swiss Made" has become internationally accepted and is a household term for pretty much everyone. But where did this image originate? Is Switzerland really the center of the art of watchmaking? Let's take a look at the origins of the Swiss watch industry and find out how "Swiss Made" watches have conquered the world

The Early Days of the Swiss Watchmaking Industry

Although the first watchmakers' guild was founded in Geneva in 1601, historians today locate the beginnings of watchmaking in Germany. Peter Henlein of Nuremberg is recognized as the first blacksmith and master watchmaker and is said to have reduced watches as early as the 16th century so that they could be worn in the form of a pendant or pinned to clothing. The earliest watch dates back to 1530. At about the same time, the Huguenots fled France for Geneva, Switzerland, bringing their craftsmanship to the region. Since wearing jewellery and diamonds was considered morally reprehensible in the region at the time, many jewellers and goldsmiths switched to the production of watches. These two factors led Geneva to slowly develop into a centre of fine watchmaking. And thus, the foundation for the Swiss watch industry was laid.

It would take another 300 years for Switzerland to achieve its position as a leader in the watchmaking world. Germany and the Netherlands led the way in watchmaking until the 17th century, thanks to inventions such as the fusee and the hairspring. Ultimately, in the 18th century, it was England that took the foremost role in the development of the watch industry: prominent and influential watchmakers such as James Cox (designer of mechanical automata such as the peacock clock and the silver swan), George Graham (inventor of the Graham escapement) and John Harrison (who solved the problem of calculating longitude and invented the first marine chronometer) laid the foundations for mechanical clockwork with their technical innovations.

Rolex Datejust 126300 and Rolex Datejust 126200 next to cufflinks on a brown background

Mass Production Revolutionizes the World of Watches

Around 1770, another shift in power took shape when Frenchman Jean-Antoine Lépine invented a flatter calibre that made it possible to build thinner pocket watches. French watchmaker Frédéric Japy produced the Lépine calibre in his company in 1800, ushering in the beginning of a new era in mass production – a trend that England rejected. During the winter months, farmers and peasants began making watch parts for Geneva companies. As a result, Switzerland was soon able to produce more products than its European competitors. By 1800, England and Switzerland were producing about 200,000 timepieces. By 1850, Switzerland was producing about 2,200,000 watches annually, whereas England saw little increase in watch production during this period.

At that time, the watch industry in Switzerland was decentralized. While there were large urban centres in England, France and Germany, the watch market in Switzerland developed separate identities in each valley with their own manufacturers. This resulted in a system that became known as "établissage". Here, a watch was made up of several components that came from different suppliers. While at the time Switzerland was able to produce watches that looked like the models of its French and English competitors, they were unable to match the originals in terms of quality.

Omega Seamaster Chrono Diver 2296.80.00 men's watch with titanium case and titanium bracelet in a black shell with watch tool and watch parts

Quality, not quantity

In the course of industrialization, a number of innovators emerged early on. For example, Longines is one of the oldest watch brands in the world and was the first company to pursue manufacturing and attempt to consolidate all production under one roof. This trend originated in the American watch market, where the booming railroad industry resulted in a steadily increasing demand for reliable, affordable timepieces. When Florentine A. Jones moved from Boston to Shaffhouse, Switzerland, and founded the International Watch Company, he was the first to combine Swiss craftsmanship with American production processes. This marked another milestone in the history of the Swiss watch industry.

The USA was gaining more and more dominance at the end of the 19th century and all Swiss endeavours to flood the American market with low-priced copies failed. As a result, the strategy changed. Instead of inexpensive watches, the emphasis was now on producing quality watches in the mid-range price segment.

After World War II, Swiss watchmakers such as Longines, Patek Philippe and Vacheron Constantin finally succeeded in gaining a foothold in the American market. Since the US watch industry was relegated to the war effort, American companies were unable to keep up with the market's high demand. Switzerland, on the other hand, which remained neutral during the war, was able to resume production immediately. The capital acquired during this period and the resulting new market share formed the basis for the dominance of the Swiss watch industry over the next few decades. While "Swiss Made" watches made a name worldwide, the German watch industry was slow to recover after the Second World War.

Longines Master Collection L2.673.8.75.0 men's watch with rose gold case, white dial and black leather strap against blue lapel

What is behind the label "Swiss Made"?

"Swiss Made" has become synonymous with good watches. But the label doesn't only refer to the place where the watch was made. When a watch is allowed to use this title is clearly defined. The original legal regulations of the law on the use of the "Swiss Made" label, passed on December 23, 1971, allowed manufacturers to mark their watches with the label only under certain conditions.

The law regulated the use of the term "Swiss" or "Schweiz" for the first time, defining when a watch was considered "Swiss Made" and when it was not. For instance, a watch was allowed to call itself Swiss if its movement was used in Switzerland and the final inspection of the watch by the Manufacture d'horlogerie was conducted in Switzerland.

In fact, the "Swiss Made" label was criticized at the time because of this very low standard, which is why the "Swiss part" of a watch was more dependent on the reputation of its manufacturer. Manufacturers relied on other seals of approval as well, such as the COSC certificate or the Geneva Sealk, to demonstrate their quality more reliably.

In 1995, the regulation on the use of this label was made stricter. Since then, a watch is only considered "Swiss Made" if its movement is Swiss, the movement was used in Switzerland and the manufacturer carried out the final inspection in Switzerland. So when is a movement considered to be Swiss made? The prerequisite is that it must be assembled in Switzerland and tested there by the manufacturer as well. Furthermore, the Swiss-made components of the movement must account for at least 50% of the total value (excluding assembly costs) of a timepiece. On January 1, 2017, the law was amended again, so that the current minimum is 60%.

If a movement is intended for export and consequently is not fitted into the case in Switzerland, but otherwise meets all the criteria, the label "Swiss Movement" may be used on the watch. Unfortunately, this label is generally used in an inflationary manner for inexpensive quartz movements from Switzerland.

Cartier Baignoire 8057912 and Cartier Must 2410 ladies' watches on a sheet of newspaper next to dried grass

The Swiss watch industry in crisis

It was not until the quartz crisis in the 1970s that Switzerland began to falter, as Japan sparked a new trend with its inexpensive quartz movements, competing with the high-quality mechanical wristwatches made by Swiss manufacturers. For the Federation of the Swiss Watch Industry, this proved to be a dark chapter in the history of the wristwatch, and one that almost meant the end of the watchmaking industry in Switzerland. However, only a decade later, the Swatch Group was founded. This provided the lifeline for the Swiss watch industry, giving it a new lease on life – through the development of a Swiss quartz watch, of all things. The sales figures of the newly introduced "Swatch" shot through the roof.

Chopard L.U.C. 1963 Chronograph 161964-5002 Dubail Edition 2/8 and Jaeger LeCoultre Compressor Memovox 146.2.97-Q1702440 in black jewellery box

From cheap to luxurious

While many Swiss companies initially continued to produce using a modern form of établissage, sourcing certain components such as movements or calibres from third-party suppliers like ETA or Valjoux and only completing the assembly of the watches in-house, a trend emerged towards the production of manufacture movements. These movements are developed and produced by the brands in-house and then fitted into the watch case. Consequently, the focus shifted from the production of wristwatches as everyday commodities to watches as luxury goods.

Switzerland's dominance in the watch market, especially in the luxury sector, which was achieved through the Swatch Group and the shift in focus, remains unchallenged to this day. While luxury manufacturers from Japan and the US, as well as inexpensive fashion watches from brands such as Daniel Wellington, represent formidable competition, luxury brands from Switzerland continue to hold their own in the watch market.

In many cases, low-priced fashion watches provide an entry point into the world of watches and result in creating watch enthusiasts who later invest in well-known and established Swiss brands. The luxury segment is continuously working on strategies to win over this customer share with attractive entry-level models. The "MoonSwatch" unveiled on March 26, 2022, for example, seems to strike a chord with this group of buyers. This is because it is a "bargain version" of the legendary Moonwatch, which was created as a result of the collaboration between Swatch and Omega.

The headquarters of Swiss luxury brands

Meanwhile, the Swiss watch industry is located in the so-called "Watch Valley", which stretches over 200 km across the Swiss Canton of Jura from Geneva to Basel. Many of the companies still have their headquarters in locations where they were founded, of which Le Locle and La Chaux-de-Fonds are recognized as UNESCO World Heritage Sites for their cultural uniqueness. Other important locations in the Swiss watch industry and luxury watch brands' headquarters can be found in the table below.
Location Manufacturer
Geneva Rolex, Patek Philippe, Frederique Constant, Vacheron Constantin, Frank Muller, Chopard, Piaget
Saint-Imier Longines, Montblanc
La Chaux-de-Fonds TAG Heuer, Breitling, Cartier, Girard-Perregaux, Corum, Omega
Le Locle Vulcain, Montblanc, Ulysse Nardin, Tissot
Le Brassus Audemars Piguet
Neuchâtel Panerai
Biel/Bienne Omega (Hauptsitz)
Le Sentier Jaeger-LeCoultre, Blancpain
Nyon Hublot
Shaffhouse IWC
Glashütte (Germany) A. Lange & Söhne, Glashütte Original, Nomos Glashütte, Bruno Söhnle
Although Switzerland enjoys the international reputation as a Mecca for watch enthusiasts, the German watch industry has no reason to hide in the shadows. As the hub of German watchmaking, the town of Glashütte in Saxon Switzerland has established itself and produced several important brands. Junghans, which maintains its headquarters in the Black Forest near Schramberg, has been able to quickly establish itself on the international market as well, with a portfolio that includes both solar watches and mechanical chronographs.

In some cases, a number of Swiss companies are headquartered in Germany. The best-known example is Montblanc. This company was founded in Hamburg and chiefly operates its production facilities in Switzerland.

Audemars Piguet Millenary Maserati 26150OR.OO.D003CU.01 men's watch with rose gold case, black dial and black leather strap comes in black jewellery box next to a perfume bottle

How has Corona affected the Swiss watch market?

Since the COVID-19 pandemic clearly affected Switzerland as well, the watch industry had to adapt to the new circumstances. After a difficult start for the industry in spring 2020, in which first the major watch trade shows suffered serious havoc, which led manufacturers such as Rolex had to close their factories temporarily, the industry was able to regain its footing later in the year and seems to be emerging from the crisis stronger than before. Currently, luxury watches are even more popular than before, notably as a crisis-proof investment. This ensured that sales figures for luxury watches soared – and not just in Switzerland.

While the export value of the Swiss watch industry slumped from a previous figure of just under CHF 1.3 billion (€1.28 billion) in March 2020 to around CHF 299 million (€294 million) in April 2020, sales figures registered a renewed rise to reach a high of CHF 2.08 billion (€2.04 billion) in total in November 2021. While this development can be attributed in part to Christmas sales, even January 2022 saw a substantial export value of over CHF 1.6 billion (€1.57 billion).

The list of the leading countries for watch exports illustrates the positive development of the total export values in Switzerland from 2018 to 2021, whereas the figures for the other countries declined during the same period.

Year Switzerland Hong Kong China France Germany
2018 €18,3 Mrd. €7,1 Mrd. €4 Mrd. €2,5 Mrd. €1,7 Mrd.
2019 €19,5 Mrd. €7,3 Mrd. €4,4 Mrd. €2,7 Mrd. €1,6 Mrd.
2020 €18,1 Mrd. €5,5 Mrd. €3,3 Mrd. €1,9 Mrd. €1,4 Mrd.
2021 €21,9 Mrd. n.a. n.a. n.a. €1,4 Mrd.