ThePuristS Interview Nicolas G. Hayek,
Breguet's CEO

“Dr. Hayek's Traditions”

by Alberto Schileo (AlbertoS)

© March 2006


A few weeks ago I was able to go to L'Abbaye, in the Vallée de Joux, to visit the Manufacture Breguet and spend some time interviewing Dr. Nicolas G. Hayek, Chief Executive Officer of Breguet – and the man behind the brand's renaissance.

Everything went very well... at first. We spoke for almost one hour about the Tradition, and I was elated upon leaving his office, both for the great interview we just had and also for finally having been able to meet the man himself.

Sheer panic hit me roughly 10 minutes later, when I decided to check the sound volume of the recording I had just made... and I discovered that the minicassette tape had wound itself around the recorder's capstan! I did not have a single word of the interview on tape, and – of course – I had not been taking verbatim notes of Dr. Hayek's comments!

Luckily for me (and for you), Dr. Hayek was kind enough to offer me to redo the interview over the telephone a few days later, and this new take turned out to be just as good.  Better, actually, as the number of “no comments” dropped from three in the first take to a single one the second time around!

I thank Dr. Hayek once again for having let me take him through these questions twice, and I hope that you will enjoy reading the very interesting and enlightening answers he gave me...

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(Dr. Nicolas G. Hayek)

The Interview I understand that you were the one who came up with the idea of making the Tradition – if this is correct, how and when did you get this idea?

Nicolas G. Hayek: You know, when you live the whole day with Breguet products, with the beauty of those products for months and months, and you wear everyday the Tourbillon Breguet that I have here, you have several ideas on how to continue to create with the same sense of beauty. One of the ideas I had was just to show how important and how different the movements that Breguet made were. I thought that we could continue with that in a modern movement, have the dial as a smaller item down there, like in my Tradition, and make a very beautiful object of art. Most of the people around me thought that it was a good idea, some of them thought that maybe the movement alone was too much to show, but finally we worked together to improve the design and it looked very good in the end. Besides, the Tradition was not a development made by me alone. My whole development group was heavily involved from the beginning. It is like building a wonderful new house: many specialists discuss and decide the architecture, the design and finally it was my final decision and choice to make it as it is now.

TPS: Did this not seem like a risky proposition, at the time you started working on the project, given that this was going to be such a different watch from the rest of the Breguet line – or the rest of the industry’s products for that matter?

NGH: Well, you know, an entrepreneur is an artist. Picasso was an entrepreneur, and without wanting to compare myself to him, if you are an entrepreneur and an artist you create things, and you have to take some risk. We knew it would be a risk, we knew that maybe many people would not like it, but we made it. Most of us liked it, and it was a huge success.

TPS: I own an original Breguet “médaillon à tact” pocket watch, and I found many similarities between that movement and the one of the Tradition. Was there a specific watch or movement which was the used for the basis of the design of the calibre 507, or was it simply inspired by Abraham Louis’ designs for the individual components?

NGH: We did not take one single watch. As I said in the beginning, when you work on it years and years as I did, you absorb the beauty of the product as it has been done before, and then at some point in your mind you have a synthetic approach that says: ‘we should do it that way’. We did not take as an example one watch, and we did not try to copy many different watches. We just made a completely new Breguet watch.

TPS: Indeed, making a new movement which is so different from everything which had been done until that point in the industry must not have been simple. What were the major challenges which you were faced with in doing so?

NGH: Yes, we had very, very many challenges! First of all, the movement had to be made with modern materials, using modern mechanics, and in a modern way of doing things. The whole system could not be made the way it used to be done 200 years ago. Second, we had to make it simple, robust, high quality, but beautiful, simple and nice to look at. This was a very, very difficult situation to cope with. We succeeded because finally what we were planning to do, and we are going to do it now, is not only to create a new movement and a new watch, but to make a new family. We are going to continue making more complications with the same Tradition, and it’s going to become the Tradition family. My colleagues wanted to call it the Hayek watch, but I refused because it is Breguet’s tradition. For example, let’s take the power reserve: we had it on one side, and on the other side we had the back of the watch which was closed in the beginning. Then we thought that we better open it, that we better make it transparent on both sides, but when we made it transparent we had to make a small change to the movement so that we could also put the power reserve on the back side. We did not need this mechanically, but it enhanced the beauty of the whole watch.

TPS: Were there any challenges which proved insurmountable, and which resulted in some design changes in the movement to circumvent them?

NGH: No. When we made the ‘parechute’, we improved it very much – we made a modern ‘parechute’, and we patented it. We made it keeping in mind the idea of the parechute that Breguet made, but it is a completely new one, with a modern system, and naturally - with all the possibilities that we had - of much higher quality, which is why we patented it.

TPS: Without wanting to get technical, I understand that a lot of research also went into finding the right colour of gold for the Tradition case, which would be similar to that used at the time by Abraham Louis, and also that it was apparently not easy to obtain a surface finish on the bridges and plates that would recall that of the mercury-plating used at the time. Can you tell me something about these research processes? Did they require a lot of experimenting?

NGH: Yes, it required very much work, both from Breguet and from my people at Hayek engineering, who are among the highest specialists in metallurgy and metals. But I don’t want to comment too much on it because I know that our good competition listens to and reads your comments, Mr. Schileo. But we had to do very much work to achieve the wonderful colours that you see in the Tradition.

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TPS: Is it planned to make the watch available in any other colours of gold, or in other materials such as platinum, for example?

NGH: Yes, we are going to show a white gold Tradition in Basel.

TPS: Very interesting news, thank you. I realise you already partially answered this question, but why was the choice made of making the movement visible from the front, with a small subsidiary dial for the hours and minutes, as opposed to a more classic solution of having a full-sized dial? You mentioned that it was to highlight the movement, but were you not worried that this might make the watch not appeal to more classic collectors?

NGH: No, I was not afraid because I consider Breguet watches as objects of art. Like Leonardo da Vinci, like Picasso, or something like this, it was the architecture that was very important. What is the client going to see? The people wearing this watch, what are they going to see in front of them? We wanted to let them see a landscape that was absolutely wonderful to look at on both sides, and which is an object of art. I have it just here on my left hand side, and I am looking at it: it’s wonderful piece of art. And I can keep the time now.

TPS: I definitely agree with you! I believe that many other brands today, given an overall watch thickness of almost 12mm, would have probably housed the movement in a larger case, especially given the current market trends. So – why was a case diameter of 37mm chosen?

NGH: Well, I come back again to architecture and beauty. There is a harmony in such a piece. And the harmony of the piece as the watch is now – and I am looking at it again – means that we should not have done it bigger. It would not have the wonderful harmony and beauty that it has now. We looked at a bigger piece and we thought: ‘no, we should not do it bigger’. It is absolutely, absolutely the perfect size that we should have given it. And it can be worn by a woman and a man without any difference.

TPS: I personally love the Tradition, and I found it interesting to hear you say a little earlier that the part that you had greatly improved on compared to Abraham Louis’ design was the parechute. Because in fact, if I had to find one thing to criticize about the watch, I think that the parechute seems to lack some of the same ‘finesse’ of the design which was made in Abraham Louis’ time…

NGH: Yes, I agree with you. I felt myself the same way. But we wanted to make a compromise between the finesse of the parechute, and a very, very, very high quality. I want every Breguet watch to be of the highest quality that you can have, and not break or have problems when you wear it. Actually, quality sometimes has to do with the thickness of the product, not only if it is a moving piece, so finally we found a compromise between the two that did not hurt the total harmony of the watch at all. And though we agree that the parechute is of much higher quality, you are right – it is not of the same ‘finesse’ but still very beautiful in its own way. In the end, we had a higher quality watch with this part that’s absolutely still very beautiful – it does not make any big difference if you look at it – but that is a littler more solid.

TPS: I understand economic realities very well. In fact, speaking of them, I remember that many people’s reaction upon hearing of the Tradition’s 16,200€ recommended retail price in Basel last year (myself included) was to think that the watch was very fairly priced, and I even heard several people at the time describe it as ‘cheap’ for what it was. Did you set this low price on purpose, perhaps to test the waters so to say, or to help the watch sell?

NGH: No, no. I am myself a worshipper of substance. I am a man who loves substance, and who does not like to have things around that are not really ‘true’. When we calculated the price of this watch based on the amount of watches that we expected to get orders for, we got a price that was really, as you said, cheap. So I said: ‘ok – we are going to sell it at this price’. Everybody in the company said: ‘but people will think it is not of good quality’. And I said: ‘no, people will know that Hayek is trying to give them quality, and if we can do it at an acceptable price, why not?’ We don’t have to price it at 100,000 or 50,000, because we are going to have anyway a complete family with much higher prices – naturally – for the tourbillon and others. So we made it 21,500 CHF. In the mean time, the gold price went up by 27% in less than 2 months. And that is why we had to increase the price to 25,000 Swiss Francs. So we increased the price a little, but it is still a cheap watch for the quality that it offers.

TPS: You mentioned that you were thinking of making the Tradition become a whole line of products, and you also told us that there will be a white gold model of the tradition release this year in Basel, but what else is in store for the Tradition? Can you perhaps tell us a little bit more about this family that you will be developing?

NGH: I leave it up to your imagination, and to the imagination of your public. You should imagine that every kind of complication that a watch can possibly have could be done with the Tradition. And that we are going to do it! But I am not going to tell you which one is going to come first and which one is going to come second.

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TPS: I remember hearing somewhere that you wanted Breguet to have the largest tourbillon offering of all brands on the market. So, I am hoping that this will mean that there will be a tourbillon model of the Tradition one day, as you seem to have indicated. But – if that is indeed the case – do you think that the tourbillon cage will be inspired by the designs present in Abraham Louis’ patent paperwork?

NGH: Well, to begin with, my ambition is to stay number one in the production and sales of tourbillons worldwide. Breguet is already number one by far with the amount of tourbillons that it produces and sells, because we not only have one of the largest lines of different tourbillons, but we also produce much more than all our competitors, or many of our competitors. We are the number one in the world on this. Now if we make a tourbillon with the Tradition, it is going to be a very nice looking tourbillon. And we are very non-conventional. This means that our design group, run by myself, has two different divisions. One is a highly technical division that makes the technical things look nice, and the other is the beauty division. It’s deals with the architectural design from that point on. And we are working on a tourbillon that will please everybody. It’s a tradition, but it’s a tourbillon.

TPS: Very good news! If this tourbillon is added on top of Breguet’s current production of tourbillons, which I understand now is around 1000 or so pieces per year, are you not afraid that this could somehow ‘devaluate’ the Breguet tourbillons in general, by having so many of them available on the market?

NGH: No, not at all. Look, I am not going to confirm the numbers, but the problem is that in this world we have 6 billion people. In these 6 billion people, we have about at least 60 million who are relatively rich people. Then we have 1 or 2 or 3 or even 4 million who are millionaires, and we have very many who are even richer. So we have very many people who would like to have this object of art, and the demand that we have every year is about five times more than our production. And we do not satisfy it not only because we do not have enough production capacity – I have invested very much in increasing our production at Breguet, over 140 million – but because we do not want to produce more than the demand for Breguet Tourbillons in the 5 years before. I don’t think that the requests for Breguet tourbillons, not for the new special gimmicks that have been coming on the market, but for real genuine Breguet tourbillons which Breguet invented, is going to become lower in the next years.

TPS: I have also heard rumours about a new Breguet escapement, with some people saying that it is an escapement ‘à détente’, and others saying that it will have a silicium hairspring. Is there any truth to these rumours, and is this new escapement something we might one day even see on a Tradition?

NGH: Yes, you are also going to see them in Basel. We have two kinds of developments that we have patented: one in silicium that we developed in a laboratory here together with Rolex and Patek Philippe, and another one that we developed alone. Both of them are going to be shown in Basel.

TPS: Will we ever see a pluri-complicated Tradition, sort of ‘à la Marie Antoinette?’

NGH: No comment!!! (laughs)

TPS: Speaking of the Marie Antoinette, if you allow me a small digression, I have heard that you will be building a replica of that watch as well, just as was done for the ‘N° 5’. Can you tell me a bit more about this project? For example, will there be more than one made?

NGH: For the time being, we are starting with one because it is going to cost us about 10 million Swiss Francs to make. It is a very, very difficult watch; it’s the most complicated watch that has ever been done as a pocket watch, and for sure we are going to make one. We are already working very hard on it, on the basis of all the information we have about this watch, of the pictures that we have about this watch, and of our normal Breguet design. Taking all this in account, with all the young people that we have put on it and who have been working very hard on it for about six months, we expect to be able to show it in 2008. Then we will decide whether we want to make a few more, whether we want to make 5 or 10 pieces of it. But for the time being it is one single piece.

TPS: You seem to be particularly attached to the Breguet brand, which – unless I am mistaken – is the only brand in the Swatch Group with which you are so involved in day-to-day operations, having even several roles. Where does this love for Breguet come from?

NGH: Well, to start with, I am also involved in Swatch, and I am the chairman of the whole group, but don’t forget that I launched the Swatch, and I love Swatch. For me, the Swatch was the real piece of beauty that saved the whole industry, for many reasons – the book I worked on that appeared recently explains why. Now, I love all my children, the 18 brands. Breguet was a small child, suffering and sick. And I had to get it to a position where it is very healthy. You do this with all your children, but when you have one of them that is weaker that the others you take more care of them. When we took over Breguet in 1999, even the banks did not accept to put Breguet on the stock exchange. The previous owner wanted to go on the stock exchange with it, and the banks refused. Nobody wanted to buy Breguet. Nobody knew what Breguet was. It was completely forgotten. So I took that piece of art and made it completely alive again. Naturally it is the baby that I am taking care of very, very strongly, so that we can get to the point where it should be. It’s one of the biggest, if not the largest, watch companies in the world, even though we are not going to produce more than 50,000 pieces a year. But 50,000 pieces will probably give us as much sales as some of the big ones, such as Cartier, Rolex or Omega…

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TPS: Well, it’s interesting to hear you speak about production numbers, because I recently read on the Breguet web site that you plan on increasing the production volume of Breguet as a whole to respond to the increasing demand. So is 50,000 pieces where you see yourself going with this?

NGH: Well, at the maximum. Not next year, or the year after, but as the maximum. You know, if you take the production of Rolex it’s estimated at more than 600,000 pieces per year, Omega is over 650,000 pieces, Cartier is about 500,000 pieces. If you take Patek Philippe, it is about 30,000. With Breguet, we are going to stop at 50,000 and then we are only improving and creating new watches and new jewellery.

TPS: Please allow me a somewhat controversial question. Are you not afraid that by putting yourself so much in the spotlight ‘vis-à-vis’ Breguet – I am thinking for example of your message coming before the pages on Abraham Louis in the Breguet catalogue – you may end up casting some sort of shadow on the heritage and origins of the brand?

NGH: No, I don’t think so. You see, at the beginning I myself was doubtful about it. But the result is that between the spirit of Abraham Breguet as an entrepreneur and a watchmaker and my spirit, there is not an enormous difference in mentality, and this doesn’t cast any shadow. On the contrary, people think: ‘these people are continuing the same tradition, the same spirit, the same approach to quality and to beauty’, and this is enhancing it. According to what my people said, this has helped very much to reposition Breguet making it again today number one and much bigger and international than Breguet has ever been in its history.

TPS: The Swatch Group basically ‘resurrected’ the brand since their purchase of Breguet, and you managed to turn it back to the splendour of its former times, when Abraham Louis was the undisputed master among all watchmakers. You must be quite proud of this achievement... was it a difficult thing to do?

NGH: Well, I don’t know… I am a man who does things. I am a doer. I do not only think and speak or discuss, but I immediately go into action. I have done so many things in my life, that at my age you are not proud anymore – you are just happy that this has been achieved and that Breguet, since I developed it myself, achieved more new developments than in the past.

TPS: I think that you are also a modest man... How do you see the watch industry in general today? Do you think it’s healthy? Where do you see it going in the next 5 or 10 years?

NGH: Well, any industry that is very much overheated is not healthy. When you have overheated sales and requirements for products that are objects of art, but that are also consumer products, you have a problem that you have to cope with. This is that many, many people who are not in the industry, and who don’t have any tradition with this industry, think that they should enter it because there is very much money in it. I remember when a very good Italian designer, one of the big names in men’s fashion, came to me and showed me a report from an American consulting company telling him that with watches one can make an 85% operating profit, which is actually not true. Of course, everybody who sees 85% operating profit – most of these people are business men, they are not artists – considers: ‘I should make an 85% profit, so I should go there’. And you have many people entering this industry, when they themselves don’t know how to make a watch, so they buy components from us or other people, take a brand name that is known in the United States or in Europe, and try to make – out of Chinese products or other products – a watch that looks good but that does not have the quality, the innovation and the charm of what we are doing. Now, this is something that is going to hurt the industry, and in 5 to 10 years only the solid watchmakers – the real people who know what a watch is, who can make a watch, who work with their hands – are going to stay. Everybody else is going to be like a fashion: it’s a good fashion today and it will disappear tomorrow. This will get the industry to a much more healthy situation, but it is still an industry that is very, very interesting, and very, very lovable. Naturally it’s also a Swiss industry: the people of Switzerland love this industry, they know how to make it run, they have a big tradition of the many, many things that nobody else can do with the same beauty and the same precision, and I think it’s going to remain a very important industry.

TPS: Indeed, speaking of this fashion phenomenon you mentioned, what do you think about the many new watch brands that we have seen emerge in the past few years? I am thinking, for exemple, about brands such as Richard Mille or Roger Dubuis, which have both – even if in different ways – moved away from traditional watchmaking to go more towards ‘status symbol’ watches. The Hublot Big Bang would also be a good exemple of the phenomenon I am talking about...

NGH: Well, it’s a normal phenomenon. People take advantage of human weaknesses, such as: ‘I want to appear much better than another guy’. But this is nothing that would be viable, this is not the basis for creating a solid brand and a long lasting industry. They can survive a few months, a few years, but in the long run they will not be able to make out of it really a big, big brand.

TPS: As a last question, I see that you are wearing a Tradition yourself, among the other watches representing the various brands of the Swatch Group. Most collectors I know would cringe just at the thought of two watches touching each other while in their storage cases, much less when they are on the wrist. So – and I realise you must have been asked this question many times already, but I know that many people are intrigued by this – how do you manage to keep your watches in shape? Do you change them often? Do their cases get repolished from time to time?

NGH: Well, to start with I wear watches that do not harm eachother, made of special materials that do not hit or do something bad to the other watches. This is a very, very important thing because if you put two watches together, and one of them has a hard metal in it, then you really have a problem with the quality of the surface of the other watch that you are wearing. So I wear on one side the first Swatch that ever was done in plastic, and it is still on my wrist after 23 years. I have been offered by a big museum 250,000 dollars if I sign it and give it to them, but I will not give it – it’s a talisman for me. Near it, I have a tourbillon from Breguet, which has been on my wrist for over 6 years now, and I have never had a problem with the surface or the ‘polissage’ of it. The only thing I did is change, for the Swatch watch, the battery and the bracelet. On the other hand, I wear a Tradition and a very, very special Omega that was made for me about 25 or 30 years ago. It’s in a very special alloy of materials, including manganese and some other materials, which is absolutely soft and does not hurt the other watch. It’s the same thing with these: I have been wearing both for a year now, and I have no problem with them. Now, why do I wear four watches? I have very many reasons for it. First of all I love beauty, and I have four beautiful watches on my wrists that I want to look at – I want to see them. Second, because I am always in the press, being photographed or on television somewhere, most of our brands want me to wear their watches. In that case, on that special occasion, I change my watches and I put on the watch of the company that we own, of the brand that has called me to give a press conference, or an interview, or something like that. But I take very good care of my watches!

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