TAG Heuer trickles down its technology

Stéphane Linder: These nine months have given me time to analyse the strengths and weaknesses of the brand, which I happen to know very well given that I arrived here in 1993. The first thing I can say is that in the ten years since the original V4, TAG Heuer has gone upscale and up in price very quickly. By this I mean we have focused our efforts on two segments: watches priced between CHF 3,000 and CHF 5,000 and those between CHF 5,000 and CHF 10,000, and with some considerable success, particularly as we now propose two in-house chronograph movements, the 1887 and the CH 80. The latter, which we presented hot off the production line in November last year, now joins our collections inside the Carrera CH 80. So yes, we’ve done well in this area but possibly we’ve neglected the market for simpler, lower-priced watches where, contrary to what some might think, there are some real opportunities to be had given the relatively limited choice. This is why we’re now working on the under CHF 3,000 price segment with some well-designed, well-made, three-hand watches. This year’s Carrera Calibre 5 collection is part of this strategy which also enables us to position the brand on the Chinese market.

We are indeed in the fortunate position of being a large-volume brand, which now includes our own chronograph calibres to the tune of 50,000 units today and double that in less than two years, and at the same time we can come up with such technological breakthroughs as the V4, the MikroPendulum, the first magnetic chronograph accurate to one-hundredth of a second, or the Mikrogirder which mechanically measures two-thousandths of a second, to name but three. While we can’t yet produce more than 200 a year of these haute horlogerie watches, that is our Mikro dual-chain range, one thing is clear: we have a capacity for innovation that is unique in the profession and we have industrial resources tailored for mass production. It makes sense to imagine a crossover of the two by applying our innovations to models that are intended for large-scale production. Until now we’ve focused on exteriors. Now we need to move up a level and apply innovation to movements, and be mechanically more creative. We have several projects in the pipeline that should see daylight within the next two to three years.

No. Too much vertical integration would make us less efficient and less competitive. The parts we produce are the ones to which we can bring added value. The strategic parts, you might say. Which is more than sufficient.

TAG Heuer is a global brand, although we are lagging behind slightly in China where we got off to a much later start than many others. So we’re going to invest in China with high expectations of winning market share. In the other more mature regions we’re more concerned with cutting back our presence to increase productivity at points of sale. All this will be backed by a new advertising campaign, which will be another highlight for TAG Heuer this year.