Everyone who comes to Basel this year will be surprised to find a completely transformed Messeplatz. A large building hangs as if suspended in mid-air above the large square where dozens of trams pass underneath. And this is only the beginning of the major changes that are happening at the exhibition halls, work that will be finished only next year. Estimates for the new construction are around CHF 430 million. To this enormous amount of money, we should add the budgets required for the dozens of new stands that will be constructed, also in the millions.

We can just imagine all the negotiations that must be in full swing—negotiations that are undoubtedly laborious since the outcomes will determine the watch industry hierarchy for the next ten years. The size, the location, the architectural prowess of the stands, and even the neighbours are all very important signs that will be carefully scrutinised by the entire industry.

By making such an investment, BaselWorld is sending a clear signal. Not only does the fair intend to maintain its supremacy but it also intends to strengthen it. We might ask, however, if these changes will ultimately be to the detriment of the current mix, which is one of the strong points of BaselWorld. Contrary to the SIHH, where a brand is “among friends”, in other words, in good company at a comparable level, BaselWorld maintains a delightful “show” atmosphere in which royalty mixes with the mere mortals, where you can find a timepiece for a million francs or one for two francs. For lunch, you can grab a quick veal sausage or dip a silver spoon into a plate of caviar.

During this time, it seems that the SIHH is reconsidering its configuration. But, the recent decision by Girard-Perregaux and JeanRichard to join BaselWorld has nothing to do with it for the simple reason that since these two brands entered into the PPR fold, they would logically and logistically want to be with the other brands in the group, especially Gucci and Boucheron.

But the problem of timing complicates matters once again. The provisional dates for the next SIHH have been set for January 21 to 25, 2013. Next year, however, BaselWorld will only open its doors at the end of April (April 25 to May 2) because of the construction work. This is a good three months later than the SIHH. Since the large brands that are not at the SIHH do not want to “lose” three months, it is a safe bet that the “phagocytosis” phenomenon of the SIHH by a number of private shows held in the luxury Geneva hotels will get a big boost.

As the inviting organisation, however, will the SIHH tolerate these other shows riding on its coattails? As one of the managers at the FHH, the Fondation de la Haute Horlogerie (the organiser of the SIHH), says rather philosophically, “Even if we are unfailingly allied in time, since all watch brands share a common interest, it’s dog eat dog on the ground…”

And, once again, it will be the most fragile and the most modest companies that run the risk of paying the heaviest price. On one hand, the most coveted locations at BaselWorld will quickly be snapped up by the most powerful brands, and no doubt prices will rise for everyone. On the other hand, the GTE show, organised for independents in Geneva in parallel with the SIHH, did not fare so well, and it is probable that it will not take place again next year. Because of a lack of resources and available space, not all of these same small companies can rent space in the hotels around the lake.

Everything is accelerating towards a gradual unravelling of the watchmaking fabric (as is also being seen in the economy in general). There will always be those who succeed in reaping the benefits from this change, but for many medium-sized brands that have been managing up to now, the challenges will be great.

Source: Europa Star April - May 2012 Magazine Issue