Certainly, this makes sense for some companies, especially those with the financial wherewithal to undergo the investment required. At the same time, there are lots of reasons for brands to continue to outsource movements. It’s not an easy decision and there’s no one correct answer.

Buying movements
This is the way that the watch industry has worked since the very beginning - brands have purchased movements from specialized companies for centuries. There is no shame in buying proven technology and, in fact, some brands prefer to do things this way, so they know there are not going to be any problems.
There are several Swiss movement makers in Switzerland – ETA, Sellita, Concepto, Dubois Dépraz and others – as well as manufacturers in Japan, China and other countries, but a general shortage of movements and the inability to depend on on-time deliveries is forcing companies to scramble to find alternative possibilities.
One of those possibilities is developing in-house movements, a significant commitment and investment for any brand, not to mention for small brands that have traditionally had difficulty acquiring movements.
Antoine Preziuso, who has acquired movements from suppliers, says “There is an interest in developing your own movements if you produce big series, but the cost of research, then development, and production, is really high, so you just can’t do if you are only creating unique pieces or limited series.”
Preziuso sees the problem of reliability and after-sales service as the biggest stumbling blocks. “The inconvenience is above all at the client level - a movement that is developed in-house doesn’t necessarily ensure after-sales service for the client from the brand for the long-term,” he explains. “Numerous brands have offered very interesting and original concepts, but what will happen once these pieces come back for repair? Years of research are needed to have a reliable movement. Now, certain collectors are only looking for horological feats and are not really preoccupied by the functioning of a timepiece. However, when you invest hundreds of thousands of francs, it seems to me that the least a brand can do is deliver a functioning watch and ensure that it can be repaired on the long-term, in other words, for a few generations.”




3VOLUTION II by Antoine Preziuso


Making movements
In recent years, many brands have turned to developing in-house movements to solve supply and quality problems, and to control their own destiny.
Carl F. Bucherer was one of the first and it unveiled the CFBA1000 base movement at the 2009 BaselWorld fair, after five expensive years of development.
“We made the decision to do our own movement in 2004,” says Thomas Morf, CEO, Carl F. Bucherer. “I believe that every genuine watch manufacture in a certain price range should master the ‘engine’ of the watch, they should master watchmaking. The end consumer at our price point deserves something with substance. We are not going to manufacture quartz movements and we will still use ETA base movements, but at the top of the pyramid we will have our own movement. This separates the ‘wannabes’ from the real companies.
“The expense is great and there are a lot of drawbacks,” Morf admits. “You go two steps forward and one step back. There are a lot of problems when you develop your own movement. it’s a hard road. Were the first prototypes as accurate as an ETA movement? Of course not, but there are improvements being made all the time.”
Having a solid financial foundation is imperative to the commitment of making your own movement. “The Bucherer Group of companies has a strong financial backbone,” acknowledges Morf. “You have to have perseverance, patience and you have to think about it carefully. It’s not just about manufacturing 20 movements. We have the intention to build one-third of our collection one day with our movement. It’s not a hobby, it’s a semi-industrialized process. That means you have to have the critical mass that will really pay off, otherwise don’t even try. If you try to make a watch between US$1,000 and US$5,000 using an in-house movement, you are an idiot.
“My purpose is not to do this because I like it, though I like it very much, but I am here to generate profit for the company,” Morf concludes. “It’s not the hobby of a rich man, it’s something that has to contribute. It’s a business model. Those that don’t have the business model, they think it’s a trend, they have to think about the consequences, otherwise they shouldn’t do it.”




CFB A1000 by Carl F. Bucherer
Thomas Morf, CEO Carl F. Bucherer


Growing expectations for Panerai
Another industry leader in in-house movements is Panerai. Says Panerai President and CEO Angelo Bonati, “We started our in-house movement development when there was no trouble getting movements, it was a strategic mission for the brand. Panerai has to be exclusive and be very authentic, and you cannot be authentic in the high-end segment if you don’t build movements with your own characteristics. That’s what I wanted and that’s what we are achieving.
“When we announced what we were doing, the clients initially were a little suspicious, because it was new and something Panerai had not done before. Now the customers appreciate what we are doing and, more importantly, they are buying the watches.”
Panerai currently uses three movements from ETA, while using six in-house Panerai calibres. Bonati says that they will continue to buy ETA movements for the entry level range, but there is a strong and growing customer base that now expects in-house movements in the watches they buy.
“There are some risks to in-house movements, because you are an entrepreneur and you have to invest,” Bonati admits. “If you don’t risk, however, you don’t have any return. We want to increase the value of the brand and, in my opinion, Panerai is more complete than before. It’s not easy to do this, because we have to continue to invest and we have to continue to always have new ideas, but for Panerai, it was necessary - we have added value.




CALIBRE P.999 and CALIBRE P.2006/3 by Panerai


Bovet and Dimier: a tradition continues
Bovet purchased the movement house Dimier in 2007, to be able to develop and manufacture its own tourbillon movements. “To be able to make your own movements makes it possible to live your passion completely,” says Pascal Raffy, President, Bovet. “It’s very important to be able to understand all the skills from construction to all the skills of making the movements. It’s so difficult, but it’s possible to improve every year and develop novelties, while keeping the standards high. We also have the ability to make the movement as beautiful as it can be.
“I don’t see any negatives from our commitment,” Raffy continues. “Of course, it’s a big responsibility. If a third party supplies movements to you, they have the responsibility of reliability, finishing and after sales service. This gives me another way to respect our suppliers, because I know the difficulties, which are money, but doing it ourselves makes it easier to find solutions.”
On top of the tourbillon movements, his group manufactures (including the springs), Raffy is in development of a base movement to be manufactured at Dimier. “When I took over Dimier, we knew the in-house base movement couldn’t be done within two years, so we have a ten year plan. A base movement is very hard to make reliable. We have a design, and now we are starting the prototypes, then we will go to the zero series, then we will go into production. It’s not enough just to have the passion and desire, developing a base movement is extremely difficult.”




The Dimier Tourbillon manufacture in Tramelan


Frederique Constant and creativity of design
Frederique Constant does its own movements for a portion of its production, the highest end pieces of course. “Creativity of design is so important to use, we had the possibility to develop the Heart Beat Manufacture with the Heart Beat opening perfectly centred at six o’clock and we patented the reverse bridge on the dial side,” says Peter Stas, President of Frederique Constant. “Creativity and independence is the reason we do it. We started the development of our own calibre in 2001 and have some history now. This certainly helped to increase our credibility and brand awareness.”
Customers are becoming aware of the source of movements in their favourite watches. “Independence, of course, is a big reason for brands to develop their own movements, and if the movement is good, they are in a better position in the mind of the final customer,” says Laurent Piccioto, Chronopassion (Paris). “The problem is that the movement has to be irreproachable in terms of functions and finishing. There are customers that prefer an in-house movement, but they approach this with a lot of suspicion, because people are not ready to have a bad experience. Generally, they wait a while to be sure the market accepts and validates the quality of a new home made movement.”




MAXIME MANUFACTURE AUTOMATIC by Frederique Constant


New facility for Hublot's Unico
Hublot recently introduced its new in-house movement, the Unico, and opened a dedicated facility in Nyon, Switzerland. “The benefits of having an in-house movement is first of all the independence in the production capacity, but secondly and as important, the independency of creativity,” says Jean-Claude Biver, President, Hublot. “When you buy a movement from a third party, you buy what they have created. When you have your own production tools, you can develop your own ideas and not just buy the ideas of others. In-house movements give substance and legitimacy to the brand. No brand in the higher end price segment can be built up without these two components.
“Reliability is essential for our brand and its price segment,” Biver continues. “It's an absolute priority and we would never allow an in-house movement to be of an inferior quality as a supplied movement. That would be totally incoherent and destructive for our image and brand.”




UNICO by Hublot


Armin Strom's dream comes true
Armin Strom, famous for his custom skel-etonization, recently brought in new investors, and shortly thereafter the decision was made to expand and to develop an in-house movement. Serge Michel, CEO, Armin Strom, hired movement designer Claude Greisler, from Christophe Claret’s manufacture, to begin work on a new movement.
“It has always been Armin Strom’s dream to have his own movement,” says Michel. “Mr. Strom consulted on this movement from the beginning, but the main constructor was Greisler. One of the main reasons why we decided to do our own movement is independence. We are not only financially independent now, but also technically independent. We can do the movement as we want to, and we can do the finishing the way we want. We have complete control over the production and the finishing. Already we have been asked by other companies to produce movements for them, but for now we will be producing for our own collection exclusively. There is definitely a possibility for producing for other companies in the future.
“One has to always be wary of costs when involved in such high investments,” he continues. “Obviously, the return on investment (ROI) is for the long-term but again Armin Strom is a brand for the long term and by the investments made, we proved that we are in it for the very long-term. Ideally, vertical integration should be done by brands who desire to invest in their future. Unfortunately, the investments are considerable and the ROI is never immediate.”
Reliability is a primary concern as a brand’s reputation can be made or destroyed by it. “This in one more reason we have made such an investment in our own facilities; as we want full control in the ability to adapt it at the flick of a switch and modify any component if necessary,” Michel adds. “Because we have used the best constructor in the field, we feel confident that through the various development and test stages, our new calibre (ARM09) will be perfectly ready when delivered to the end consumers.”

Hybrids
For years, companies have been designing movements and getting them produced, to their specifications, somewhere else. These certainly don’t qualify as an ‘in-house’ movements, but neither are they merely supplied. They are hybrids, with the amount of brand involvement up in the air. Some companies, which shall remain unnamed, merely stamp their name and a number on the movement and call it their own, while others truly design it and then often do so much work on the movements (finishing, modules, disassembly and reassembly, the switching out of parts and more), when they get to their facility, the movement is virtually unrecognizable from its base.
It all depends on how transparent a brand wants to be. Harry Winston, for example, is very clear about where its movements come from – Bovet’s Dimier does one of their tourbillons – while other companies are purposely vague and in many cases outright misleading. I remember walking through Christophe Claret’s workshops, seeing entire workshops dedicated to making movements for brands who claimed to be manufacturing their own.
Olivier Bernheim, President, Raymond Weil, knows the investment needed to have an in-house movement and chooses to use movements developed together with specialists that are exclusive to Raymond Weil. “The necessary investment to industrialize and test an in-house movement is heavy, making the cost of the watches not competitive at all. Brands like Raymond Weil will continue to develop internal, owned complications depending on their resources, sometimes helped by third parties to industrialize partly or totally their project,” he details. “That is the case for the Raymond Weil Don Giovanni Così Grande Two Time Zones, which features a mechanical complication exclusive to our brand. Most of the time those projects don’t start from scratch but are connected with an existing in-house movement base available already.”
Oris designs and sells only mechanical watches, but it works with the best suppliers to ensure that the movements work well and fit the company’s price range. “We design our own movements and we work directly with companies like ETA and smaller movement companies to manufacture our own movements,” Mark Wasserman, President, Oris North America, says. “These movements are exclusive to us. Our worldtimer movement is an ETA base and an Oris movement, and no one else has that movement. The Swiss are very good at respecting our confidentiality. We are continuing to design and engineer our own movements, one of which will be released in BaselWorld this year.”

Truth telling
No matter which road a brand chooses, it’s important that customers are not misled. As customers become savvier, it’s imperative that brands tell the truth.
“Our brand has always chosen to be transparent,” says Preziuso. “I understand that from a marketing position certain brands dress up the truth. However, clients are increasingly informed and are becoming true connoisseurs. In the end, honesty is certainly the best strategy to adopt.”
There is too much information readily available for the truth to stay secret for long. “Transparency and authenticity are two key elements of the 21st Century,” says Hublot’s Biver. “Nothing can be hidden anymore for too long. We are living in the century of communication and therefore whatever you do or communicate must be based on true facts.”
“It’s impossible for a house like Bovet to pretend that we are doing all our own movements,” Raffy says. “We have to tell the truth. When you do your own tourbillons, like we do, we are proud to say it, but we will not deceive other people. You can’t express the passion when you start with a lie.”

The future
More and more brands are announcing the development or production of their own in-house movement. No one knows if consumers truly value an in-house movement, but as more brands market this point of differentiation, chances are they will start to – or at least require a brand to explain why they aren’t using their own movement.
It’s not easy to make a reliable movement from scratch, so companies who do it, like Carl F. Bucherer, are to be commended.
Whether the marketplace rewards their initiat-ive remains to be seen.


Source: Europa Star February-March 2010 Magazine Issue