Think back to the time when you were new to the world of watches. There’s a good chance that at some point, perhaps in the smooth patter of a sales pitch or the heated debate of an Instagram comment thread, the phrase “this has an in-house movement” was dropped, heavy with the implication that anything sourced from outside the hallowed manufacture was inferior. This attitude still carries a lot of weight, despite the concept of “in-house” superiority being relatively young and driven largely by an industry emerging from crisis and looking to reposition itself firmly into the luxury sector. We look at the industry factors that led to the rise of “in-house” and why the concept might not be as important as it once was.

’90S REVIVAL

The 1990s was an interesting and exciting time for watches. The late ’80s and early ’90s, in particular, was a marked contrast to the doom and gloom atmosphere of that period of time in Switzerland known as the “Quartz Crisis,” when new technologies and competitively priced watches made in Japan combined to take a sizeable chunk out of the traditional Swiss industry, an industry which had evolved piecemeal over the course of the 20th century into a complex and intermingled system of small, specialized producers who, just like the gears and wheels of the watch calibers they helped produce, all played a small, but important part in. As a result of the crisis, many of these smaller suppliers — as well as many smaller watch brands — didn’t stay afloat, and the situation for the Swiss looked incredibly grim. But, as always, crisis represents opportunity, and some visionaries — including industry leaders Nicolas G. Hayek, Jean- Claude Biver, Günter Blumlein and others saw a way forward. The future of Swiss watches wasn’t to compete with the accessibly priced quartz offering but to lean even harder into traditional mechanical watchmaking. To proudly position it as a product not just of necessity but of luxury and aspiration.

BRINGING IT UNDER ONE ROOF

At about the same time that the watch buyers were coming around to the appeal of mechanical watchmaking in a big way, the bigger players in the watchmaking space saw the opportunities inherent in this revitalized market sector and acted accordingly.

Increasingly, the landscape of the Swiss marketplace was one dominated by corporate consolidation, which saw the emergence of the major players in luxury watchmaking that dominate the space today. Now, obviously, corporate groups in the watchmaking space existed prior to the ’90s, with the most famous example — and the one that set the tone for years to come — being the Swatch Group. Founded in 1983 under the leadership of Nicolas G. Hayek, Swatch (then SMH) combined two of the major industrial players, ASUAG and SSIH, under the instructions of their creditors. Hayek’s vision of watchmaking was streamlined and efficient — and it didn’t take long for others to follow his lead.

The other major players in the watchmaking space are, of course, Richemont and LVMH (Louis Vuitton Moët Hennessy), both founded a few years later in 1988. Today, Richemont is one of the true giants of the watch industry, with powerhouse brands like Cartier, Van Cleef & Arpels, IWC and Vacheron Constantin in its portfolio. The group’s entry into watches included brands like Cartier, Baume & Mercier and Piaget and it expanded aggressively throughout the ’90s, picking up Vacheron Constantin and Panerai, and in 2000 acquiring Les Manufactures Horlogères S.A., which added Jaeger-LeCoultre, IWC and A. Lange & Söhne into the mix. LVMH, in contrast, jumped into the watch space hard in 1999, picking up sports powerhouse TAG Heuer and Zenith, followed by Hublot in 2008 and Bvlgari in 2011. The most recent blue-chip addition is Tiffany & Co., and while the brand is predominantly known for its jewelry, the potential for Tiffany & Co. watches is strong indeed.

While this sort of publicly listed consolidation of separate brands under a corporate masthead is the most visible example of industry amalgamation, it’s far from the only example. Take Rolex, for example. Viewed by many as the epitome of an “in-house” brand, the Big Crown is famous for doing it all themselves.
Except, until relatively recently, this wasn’t true. The vintage Rolex watches we all know and love have Singer dials, Gay Frères bracelets, to name but two well-recognized examples of outsourcing. In the 1990s, Rolex, under the leadership of veteran CEO Patrick Heiniger spent significant time and money buying out these suppliers and bringing them truly “in-house.” One of the most significant of these purchases was Aegler, a movement maker who had been the exclusive producers of non-chronograph Rolex movements since the 1930s. On a practical level, the fact that Rolex brought Aegler “in-house” in 2004 made no obvious difference in the construction of Rolex watches, except (and this is an important exception) it allowed the brand even greater control over quality and production.

THE IN-HOUSE ERA

As more and more of the big brands started to actually own the means of their production, this hitherto unprecedented level of vertical integration led to new opportunities. Some brands, like Rolex, were largely content with where they were and used their greater control to make incremental behind-the-scenes improvements to their world-famous watches.

For others, it offered a potent point of difference and a marketing opportunity. The term, used well, evokes images of Philippe Dufour-like artisans, smoking pipes and piously polishing plates in splendid isolation. While this image is more or less true for a small handful of brands (smoking at the bench is probably frowned upon), in the vast majority of cases it would be more accurate to say, “This new exclusive in- house movement, which is a slightly modified example of a 50-year old design, has been made at a wholly owned facility, and shipped to another wholly owned facility for assembly.”

The phrase “in-house” is technically true, but it certainly lacks the romance of the marketing version. There is great power in this narrative. After all, a movement made solely under one roof (be that corporate or literal) feels more authentic and of an implicitly higher quality than one that is merely bought as an off-the-shelf ébauche from an external supplier. And, crass as it may sound, in many cases, more authentic means more money. One of the greatest modern examples of an in-house movement is Omega’s Co-Axial escapement, a proprietary technological innovation that Omega has leaned heavily on since they debuted it in 1999. Of course, Omega didn’t develop the technology — that was a stroke of genius from George Daniels, who conceived it in the early ’70s, and had a prototype running in 1974. Daniels then spent the next 20 years shopping it around Switzerland, with brands declining as it was seen as either too difficult to commercially scale, or offering a negligible technical benefit over traditional escapements. Omega bought the rights to the technology in 1994 and spent five long years getting it ready for commercial production, debuting it on the eve of the millennium in 1999. Based on this long lead time, it seems like the concerns around the Co-Axial being difficult to mass produce had some merit, and as for the issues of accuracy, I’m not the best person to answer that. But what all the other brands who said no to Daniels missed, was that Co-Axial isn’t really about accuracy. It’s about having something truly unique, about being able to tell a story of accuracy that no one else can. Omega has done exceptionally well in this instance, and stands out as one of the great success stories of the “in-house” era.

PROVEN PERFORMERS

Here’s the thing, though. There are many truly great, excellent, exceptional timepieces made that are not in-house. Or at least not fully. One of the most iconic examples is IWC’s 1993 masterpiece — and a clarion call for mechanical watches — Il Destriero Scafusia, a grand complication rocking a tourbillon, a minute repeater, a perpetual calendar and more, all built off the back of the oh-so-humble Valjoux 7750. Not that the famously wobbly chronograph movement was as recognizable as such once Kurt Klaus, Richard Habring, Dominique Renaud and Giulio Papi were finished with it. And while one of IWC’s most famous offerings is a great example, it’s hardly the only one. The Jaeger-LeCoultre caliber 920 is an old movement — created in 1967, this slender workhorse, a 2.45mm fully rotored automatic has shown up time and time again in some of history’s most famous watches and is still used today. The Patek Philippe Nautilus, the Vacheron Constantin 222 and the Audemars Piguet Royal Oak have all used this proven ébauche to ensure a slim profile. In fact, Audemars Piguet now owns the exclusive rights to manufacture this design. So, here’s the question. Is the Royal Oak reference 15202 a watch with an in-house movement? You could argue yes, as Audemars Piguet made the movement and has exclusivity over it. You could also argue no, as this venerable movement was not designed by the brand. Or, you could take it further. Even if the bulk of the design, construction and finishing of the caliber is done under one roof, in the vast majority of instances there will be exceptions. The rubies, the crystals, the springs, the rubber gaskets — all these elements are typically sourced from outside suppliers. Does this invalidate the claim to in-house authenticity? The bigger question is, does it matter?

WHERE THE VALUE LIES

The answer, of course, is subjective. At the moment, I’m wearing a watch made by anOrdain. It’s powered by an exceptionally humble movement, the Sellita SW 210-1, a manually wound number that is essentially a clone of the ETA 2801-2. It’s a spectacularly uninteresting, but rock solid movement. Definitely not in-house, but that’s OK because I bought this watch for the stunning enamel dial, and while putting a fancier caliber in there is all well and good, it would also add significantly to the price point. You can make the same argument for something like one of the spectacular watches from J.N. Shapiro, which are powered by a stunning ébauche movement from Uhren Werke Dresden. These calibers are attractive manually wound movements with gorgeous finishing and some nice technical flourishes like the individual wheel brackets. Again, not in-house, but J.N. Shapiro’s expertise is, first and foremost, engine turning. For a young brand, investing the time, energy and money into a movement, when there are plenty of serviceable third-party options on the table, doesn’t just not makes sense, it could — in fact — be bad for business.

Then there are the liminal cases, where the in-house caliber is there almost as a pro forma, offering very little beyond the tried and true third-party offerings — much of Cartier’s more accessible mechanical watchmaking falls into this category. Or you could do what many smart watchmakers do and use a quality ébauche and build your own modules on top of it. This is the path that makers like Daniel Roth and Roger Dubuis went down, using excellent Lemania base movements and then building their own craziness on top of it. It’s also telling some of the biggest makers of what we could consider as genuinely in-house movements, Rolex and Seiko, don’t use the fact as a major selling point, instead preferring to speak to tangible things like the accuracy and reliability of their movements.

THE GAME HAS CHANGED

The watchmaking landscape was a surprisingly different place 10 or 20 years ago. There was anxiety around the supply of third-party calibers, and in-house was seen as a great value add. Today we’re a little more sophisticated, and we understand that just because a watchmaker has changed a few wheels and tweaked the rotor design, it doesn’t make a watch any more or less authentic. What matters is the intention. It still matters very much what caliber goes in a watch, but we can judge that based on what that watch is trying to achieve. A utilitarian tool watch with a gorgeously hand finished movement probably isn’t necessary, whereas on an artisanal piece from an independent maker who only crafts a dozen pieces a year, it’s pretty much expected. In-house, for the sake of it doesn’t make sense in 2023, and we need to judge each movement on its merits and what the watchmaker is trying to achieve.