Swatch Group will be free to supply mechanical watch movements wherever it wants, but won’t be allowed to abuse its dominant market position by undercutting rivals’ prices, Swiss competition watchdog WEKO said on Wednesday, according to Reuters.
The Swiss watch manufacturer has been in a battle with Sellita over the supply of movements to independent brands. For some time ETA dominated the indie watch brand market, with its 2428 series workhorse providing the power for many mechanical watches.
Many indie brands now use Seiko or Sellita, especially the SW200/300 series – which are related to older ETA designs. Why does any of this matter? Well, basically a competitive market in movement supply means lower costs for those brands who want a power unit that has proven reliability and a dash of Swiss prestige.
In the sub £600 watch market the margins are tight, so if Swatch Group can gain a near-monopoly position that is bad for business in the long run.