Paris, 1 April 2024
Estimated reading time: 3 minutes
In a revealing interview with Neue Zuercher Zeitung, Nick Hayek, CEO of Swatch Group, outlined a concerning outlook for the company in China for the remainder of the year. With consumers becoming wary of price increases, Swatch, a prominent Swiss watchmaker, foresees a challenging path in one of its most important markets.
Hayek emphasized that while China holds considerable potential, a notable shift in consumer behavior has been observed, with many taking longer to make their purchases.
“Customers have also become more price-sensitive as there have been excessive price hikes in many areas. I expect the Chinese market to remain challenging until the end of the year,” explained Hayek.
Swatch Group, known for its high-end watches such as Omega, Tissot, and Longines, as well as its plastic Swatch watches aimed at the general public, has been a major player in the global watchmaking industry.
With the Hayek family holding 43% of Swatch’s voting rights, questions about the possibility of Swatch going private were inevitable.
However, Hayek dismissed this idea, citing the heavy debt such a move would incur, a prospect not favorable to the family’s principles. “Going private is not possible without incurring massive debt, and we really don’t like debt,” he said.
Regarding the company’s succession and leadership plans, the CEO addressed the future role of his nephew, Marc Hayek, who is expected to join the board of directors in May.
While acknowledging Marc’s commitment and passion for the family business, Nick Hayek stressed that the decision to eventually take the reins as CEO would be up to Marc. “Neither my sister nor I will impose on him to take over. It remains his decision,” affirmed Hayek, thus underscoring the company’s respect for individual autonomy.
This clarification comes at a crucial time for Swatch, which must contend with unfavorable economic winds and evolving consumer attitudes.
With a heritage of innovation and quality, how Swatch Group tackles these challenges will be closely watched by industry observers and competitors alike.
Image credits: Swatch
Sources: Reuters
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