Chinese luxury watches find fans, but can they rival Swiss brands in time?

BEIJING – When Chinese brand Atelier Wen released its first watch in 2018, it was not sure whether a pricey Chinese watch – that was unabashedly marketed as such – would have an easy time finding buyers.

The Porcelain Odyssey, which featured a porcelain dial adorned with Chinese characters and made in China, was priced at about US$700 (S$938). The limited run of 570 pieces in various colours sold out in 2019.

Co-founder Robin Tallendier took that as a sign that there was demand for such a product – and with the next series of watches released in 2022, what started out as a passion project became a viable business.

“Our ambition as a brand is to celebrate Chinese culture and craftsmanship,” said Mr Tallendier, one of the company’s two French founders and watch aficionados who met while studying in Beijing. He currently splits his time among France, Singapore and China.

“We realised that the only way to be credible is to make truly world-class watches out of China,” he told The Straits Times.

In recent years, Chinese brands such as Atelier Wen have been gathering international attention for delivering competitive – and to some enthusiasts, compelling – high-end watches, in an industry traditionally dominated by Swiss, German and Japanese brands.

China is no longer simply mass-producing affordable watches but also moving up the value chain – mirroring a trend in other industries such as electric vehicles and semiconductors.

In 2020, Shenzhen-based Behrens submitted two designs for an annual Swiss watch competition, the Grand Prix d’Horlogerie de Geneve – sometimes described as the Oscars of watchmaking – and both were among the six shortlisted in their categories.

One of them, called the Rotary, was inspired by early combustion engine designs, and its guts – the gears, springs and wheels that make it tick – can be seen. It is priced at about US$5,000.

“For a brand like ours, 2020 was a watershed year,” founder Lin Bingqiang, who designs Behrens’ watches known for bold and unconventional designs, told ST.

“Many people in Europe thought it was quite innovative for a Chinese company to do something like this, so they supported us.”

But despite nudging themselves into the conversation, Chinese brands remain niche, occupying a tiny slice of the luxury market globally compared with dominant player Switzerland, home to famous brands from Rolex to Patek Philippe.

China exported 534 million wristwatches in 2023, and Switzerland 16.9 million, according to the Federation of the Swiss Watch Industry. But the average price of Switzerland’s exported watches is US$1,679, with China clocking in at just US$4.

Atelier Wen, which has employees in Shenzhen, Hong Kong, Singapore and Malaysia, sold about 1,600 watches in 2023. Behrens, which has about 100 workers, sells about 4,000 to 5,000 pieces each year, and about half of its customers are overseas.

The industry is growing. There are established names such as Shanghai – which made China’s first domestically produced watch in 1955 – and Seagull, another pioneer of Chinese watchmaking.

Newer additions include Guangzhou-based Lucky Harvey, established in 2021, and Ciga Design from Shenzhen, which was the first Chinese brand to be shortlisted for the Swiss award, in 2019.

Luxury watch brands typically sell models that start from thousands of dollars, emphasising less on their functionality and more on their desirability.

Switzerland-based luxury watch consultant Oliver Muller pointed out that luxury watches are meant less to tell time, and more for intangible wants such as status and prestige, and to mark milestones like graduations and weddings.

The main issue for Chinese brands appears to be brand perception. Mr Muller, managing director of LuxeConsult, said Chinese watches are certainly comparable with their counterparts from Europe in quality, noting that some components of Swiss watches are made in China.

But while China is not lacking in horological know-how, the critical factor is brand equity, which is the value that customers give to the brand, and which allows the brand to charge a significant premium, he noted.

While Chinese companies are good at making large quantities at competitive prices, luxury products are the opposite. “You do small quantities to fulfil high-quality expectations and rarity, because luxury is all about being exclusive,” he added.

Asked how Chinese watches can make further inroads globally, Mr Li Wei, head of the domestic collections committee at the Chinese Horologe Association, said it is a question that all Chinese brands need to solve.

“The watch’s quality, design, appearance and other aspects have been resolved – the missing ingredient is brand construction,” he added, referring to what has been achieved by Chinese watchmakers. The association was set up in 1985 and has more than 200 members, including clock and watch manufacturers.

Guangzhou-based independent watchmaker Logan Kuan Rao said while some people might have preconceptions about Chinese watches being cheap or imitative, that will eventually change as their techniques become more refined.

He noted that even Switzerland and Germany started with making knock-offs, or more affordable watches. Other European watchmakers, such as those from England and France, led the way in horological innovations before the 18th century.

“Among major watchmaking countries, China is the latest to join, and its industry is still in its early stages... In time, I’m confident that there will be very good products coming out of China,” he added.

His first timepiece, Orca was finished in 2021, and his second, Wuwei, is almost totally in-house made. Completing one takes up to 18 months, and only about 10 pieces are made a year on average, said Mr Rao, who graduated from Imperial College London in 2018.

Mr Tallendier said Chinese brands used to compete in the lower categories and high-end foreign watches safeguarded their value by touting, for instance, that they were fully handmade using complex and time-consuming processes.

Now, high-end Chinese watches also use those same processes and still sell for less, he noted. “This time, it is harder for them to justify the same prices with the same argument, bringing the more general question of ‘what constitutes value’ to the market.”