Swiss watchmakers get a big hand
Nicholas Hayek wears two watches and sometimes four. Is he simultaneously counting the seconds in New York, Tokyo, London, and Zurich? No, just checking up on his latest troubled clients - Swiss watchmakers.
This Swiss-Lebanese consultant is out to save his country's watch industry. This is no easy task as the Alpine craftsmen plunge ever further into the red. But Mr. Hayek has an answer: the biggest corporate rescue operation in the history of Switzerland.
Based on a Hayek analysis that promises prosperous days again, Swiss banks are pouring nearly 600 million Swiss francs (about $290 million) into direct investment in Switzerland's timepiece trade.
Switzerland's share of world watch production has dropped from 45 percent in 1971 to around 9 percent in 1981. Competition from Asian countries - including Hong Kong, Taiwan, Singapore, and Korea - is increasing. Then why is Mr. Hayek so optimistic?
At the top end of the quality scale, Switzerland controls some 70 percent of sales when counted in dollar volume. Though it may only produce 9 percent of the world's watches, it still has an impressive 30 percent of the total value of watch sales worldwide (down from 40 percent in 1970).
Switzerland still leads the world in export earnings from watches and watch parts. In 1982 the value of these exports was $1.5 billion, compared to Japan, in second place with $932 million.
Though Switzerland has many successful small watch companies, primarily in the high-quality area, the two largest manufacturers, Asuag and Horlogere, which make medium- and low-priced watches, are racking up big losses.
To critics who think Swiss banks must be crazy to go along with the big investment, Mr. Hayek shoots back: ''The Swiss watch industry is not at the end of the road. It is a sleeping giant about to wake up.''
The Hayek plan is to merge the country's two largest concerns, Allgemeine Schweizerische Uhrenindustrie AG (Asuag), with sales of $551 million, and Societe Suisse pour l'Industrie Horlogere SA, with $267 million in sales, into one Swiss watch company. Top-heavy management, a major problem, will be streamlined, and massive sums are to be diverted into rationalizing production, marketing, and research and development.
Top Horlogere executive Ulrich Spycher says: ''We have to learn how to get out there and sell.''
These seem strange words for a man who heads the company that produces such household words as Omega, Tissot, and Hamilton. What he means is that the Japanese are better at it and the Swiss are now out to catch up.