At Omega, a New Factory for Orders from China

At Omega, a New Factory for Orders from China

Postby koimaster » September 5th 2017, 11:00am

August frustrates Raynald Aeschlimann, president and chief executive at Omega.

When he welcomed a guest to his office for a tour of the company’s new production building here early last month, the 47-year-old chief executive was clearly unhappy. Production was running at just 60 percent of capacity, largely because Omega suppliers still shut down for almost the entire month, a summer holiday tradition in Europe.

“I want to run a full 52 weeks,” he said, gesturing toward the adjacent building where, the tour later showed, rows of assembly desks were only about half occupied.

Like most Swiss watch brands, Omega and its parent company, Swatch Group, have had a rough few years. Omega experienced a sharp drop in sales in 2015, which it linked to China’s economic slowdown and the government’s continuing crackdown on corruption and high-priced gifts.

But while Swatch does not break out sales or revenue by brand, its recent half-year report announced growth in June and July for all its brands, especially the luxury segment that includes Omega, and included a strong outlook for the rest of the year.

Mr. Aeschlimann called June a “strong month” for Omega, noting double-digit sales growth in China, its star market. “This year is very positive for some brands in China, and we are one of them,” Mr. Aeschlimann said. He added that half of Omega’s business now comes from Asia, where the Constellation watch is Omega’s market leader, especially prized by middle-class Chinese buyers. “Looking at the future,” he added, “we expect results to be better than ever next year.”

The five-story production building, which the company calls Building O, was planned to support expansion. The 172,225-square-foot structure, designed by the Pritzker Prize-winning Japanese architect Shigeru Ban, combines watchmaking facilities previously housed in three buildings. And it’s big enough, Omega executives hope, for 30 to 50 more years of growth.

With the official opening scheduled for November — two years later than originally planned because of architectural revisions — workmen in August were paving the parking lot, and the vacant reception area on the ground floor was awaiting finishing and furniture. ... aster.html


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