Hublot CEO: China markets the main focus (updated)

Hublot, one of the leading luxury watch makers in Switzerland, is targeting China markets even more. The company, part of the LVMH (LVMH) Group, market cap 186 billion euros, and its Watch division, said the same thing already a year ago, but the target is still the same. According to the CEO Ricardo Guadalupe, Hublot is aiming to become one of the leading watch brands in China and Greater China.

– We are focusing on China and Greater China markets. Our aim is to be one of the leading watch brands in China and Greater China, Mr Guadalupe said in the ComteamPUB+ interview on Thursday.

The company has not revealed the export figures, but according to Swiss Watch Industry information the China, Hong Kong and Singapore markets totalled nearly 30 % of the overall Swiss watch exports. In May the export totalled over 2 billion Swiss francs, growth 11,4 %. The biggest growth was in the premium & luxury watches, which are priced over 3000 francs.

The company is expecting a very strong growth for this year. The double-digit growth is said to continue “over the end of the year” according to Mr Guadalupe.

China is seen one of the fastest growing luxury markets in the future. In 2018 the Chinese consumers spent about 115 billion dollars on luxury items, which is one third of the global spending. And this is expected to growth in the future also so that by 2025 40 % of the world’s spending on luxury goods would be by Chinese consumers (McKinsey). So, it is not a surprise that Mr Guadalupe is talking about China.

Is luxury becoming more common?

This question is about the luxury spending and how the luxury markets are expected to develop in the future. But Mr Guadalupe has a point.

-Absolutely not for the real luxury, he says.

And he is referring for the real thing. Real luxury has always its prestige and value among its users. And this is also part of the demand for the vintage or retro luxury items in the markets at the moment.

For example financial markets are expecting the US company RealReal to be listed in New York. The company is an online marketplace for luxury products and according to the company info the trading of the shares are expected to start today, not yesterday as earlier estimated. The company raised 300 million dollars, at 20 dollars each, above the 17-19 dollars range earlier estimated. Sustainable, circular luxury is also entering the main markets.

Hublot and “Art of Fusion”

The clear sustainable standing point for Hublot is the materials. The company has been innovative and finding new ways to integrate different materials in the watch production over years. It is part of the company ideology of the Art of Fusion – the way the tradition of high-quality Swiss craftsmanship and innovation can be combined.

The material lists include magic gold, carbon, rubber, aluminium, ceramic, king gold, palladium, platinum, stainless steel, tantalum, titanium, tungsten, zirconium, osmium and aluminium. Hublot can say that it has clearly been the innovator in this area in the Swiss watch industry.

The company says that it is now also working with sustainable bags while the banning of plastic bags is already a trend in Europe.

Collaboration with Ferrari and FIFA

– The collaboration with Ferrari and our involvement in FIFA World Cup are our two main partnerships, Guadalupe says.

– This year we have two collaborations with Ferrari. The Classic Fusion Ferrari GT, which is an elegant and contemporary piece that draws inspiration from the “Gran Turismo” universe. And the Big Band Scuderia Ferrari 90 ans. This is a model that reflects the rich history and heritage of Scuderia Ferrari, he continues.

Japanese food and sea

But what does Mr Guadalupe do for the summer time? Japanese food and sea.

– Food can be compared to the watch industry in a certain way for their attention to quality, time and details. I like to spend my holidays in the Mediterranean, at Mykonos or Ibiza. Holidays is for me synonymous with relaxing, sport and good food, he concludes.

Hublot, which was founded in Switzerland in 1980, has made the journey with innovation and unique products. Watches like Big Bang have paved the way to new flagship collections like Classic Fusion and Spirit of Big Bang.

Picture: Hublot classic watches from BaselWorld 2017-2019

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Hublot to present new Ferrari watch in Basel

Hublot, part of the French LVMH (LVMH) Group,  presented several exceptional new timepieces at Baselworld 2019, including the new Ferrari watch.

– Continuing its long collaboration with Ferrari, Hublot also unveiled the Classic Fusion Ferrari GT, a watch, whose innovative design integrates the new Unico manufacture movement and the dynamic lines of Gran Turismo very high-performance luxury cars, the company says.

According to Hublot this collaboration has also for the first time enabled Hublot teams to fuse their skills with those of the “Centro Stilé Ferrari” design center. This was one fo the new moments with creating new bridges between watchmaking motorization and automotive design.

 

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GIMS2019:World premiers for luxury cars

The International Geneva Motor Show had plenty of world premier luxury cars in this years event. According to the press information, the event had over 150 world premiers and about 660.000 visitors. This year was also the year with more hybrid and electric cars in the show.

New premier models were for example from Alfa Romeo, Audi, Bentley Motors, Automobil Pininfarina, BMW and Bugatti.

Lifestyle Travel

Helsinki2018: How the markets will open on Monday?

 

helsinki2018-logoThe big question in the financial markets will be the market reactions on Monday. What have we heard so far? The first thing is that trade wars are real at the moment and the markets are waiting for more information from the meeting in Helsinki on Monday. Will the US president Donald Trump or Russian president Vladimir Putin say something regarding the trade wars, economics or sanctions? Last week the markets closed mixed globally.

The trade wars are affecting primarily auto, steel and aluminum industries globally. So far the auto industries have developed very differently. For example the Swedish car manufacturer´s Volvo stock price  (VOLVB) has increased by nearly 2 % annually, but for example the luxury car manufactuer Ferrari (Ferrari) by over 50 % in New York, On the other hand Tesla´s  (TSLA) stock price has declined by over 2,5 % and the German company Daimler´s  (DAI) by over 6 % and Volkswagen´s (VOW) with 0,5 % during the same period.

The autoindustry is important to the EU, while the German auto production is about 20 % of the global passanger car production. The turnover is about 404 billion euros according to the German Trade & Invest. And the industry sector is having otherwise very good future outlook with energy efficient cars, growth estimates are nearly 30 procent annually by 2020.

In the US, the autoindustry has seen signs of declining sales during the summer time – General Motors and Ford  have been reporting. The city of Detroit is facing lay offs.

Last year totally 17 million passanger cars were built in the EU and EU was the second largest producer of passanger cars. The US production declined by 11,5 percent and the production totalled 8 million cars.  China maintained its leading position among global passanger car producers – totally 29 percent of all cars were produced  in China according to ACEA.

So, one can understand that Tesla decided to build a new car plant in China.  The company announced last week that they will open a plant in Shanghai delivering 500 000 vehicles a year. The project time for the plant is about five years, but the size of the investment was not published.

The autoindustry is having big changes and for example the OEM production is also one part of it. So far, the EU has been the place for premium cars, but for how long? Also the UK Brexit-talks will have their own impact on the autoindustry development,

 

 

 

 

 

 

 

 

Business Finance

Hublot CEO: Double digit growth this year – Chinese consumers ranking 1st

Hublot CEO Ricardo Guadalupe says that he expects the company to grow double digit, that is about 10-11 %, this year, well above the average luxury watch industry. Speaking to ComteamPUB+ he says that this year also the Chinese consumers will be the first big customer segment for this Swiss Luxury Watchmaker.

– This year will be very unique for Hublot. Our growth estimate is double digit that is 10-11 %, which is well above the 5-6 % average growth rate in the luxury watch industry this year. This year is also the first year for Chinese consumers to be ranked the number one. Our biggest growth is coming from the Greater China area, he says to ComteamPUB+.

Hublot, part of the LVMH Group (MC:FP),  is having 8 different brand stores in China and totally 18  in Greater China and the company is planning to open new stores globally so that the total stores would be around 100 in the next couple of years. This week the new opening is in Genf, Switzerland and in June they will open a new brand store in London, in the Old Bond Street.

-We want that our customers can experience the Hublot brand when they are travelling. So this is also important that the store locations are fitting our targets. We also want to demonstrate our strong brand, he explains.

Digital transformation in the focus

Digital transformation is in the focus of luxury watch industry nowadays. Companies are building different customer experiences in the internet with storytelling and strong social media channels. For example Hublot is having 2,9 million Instagram followers and in Facebook they are having 4,1 million followers.

-Digital transformation is shaping our industry. For example Hublot is having now 50 % of its advertising costs in digital channels compared to other media channels. And we are planning to build our own e-commerce platform in the couple of years. We want Hublot digital boutiques to offer a new Brand experience to our worldwide customers, he adds.

This e-commerce has been very difficult with the luxury watch industry because of the pricing and brand value. For example another Swiss luxury watch company, Richemont, has decided to buy back their luxury watches from external dealers. This has caused the company 200 million euros profit fall according to the Financial Times.

Mr Guadalupe sees the market differently and says that Hublot would not have to do the same thing than Richemond.

-We know our customers and we track the watches we sell. Hublot has no stock while our production is in line with the demand, he explains.

Hublot´s annual production is about 50.000 units, price range from 6000 – 50.000 euros each and the production site is in Nyon, Switzerland. The average price is 20 000 euros according to the company.

The first smartwatch, Hublot Big Bang Referee

During the BaselWorld2018 Hublot also launched its first smartwatch, operating with Android. This luxury smartwatch is part of the company partnerships with FIFA World Cup now in June in Russia.

-We are thrilled with the feedback from this watch, Hublot Big Bang Referee FIFA World Cup Russia 2018. This is really the first smartwatch for us and it is also seen as the first marketing tool for our FIFA partnership. We have invited about 1000 stakeholders in our FIFA events and we are looking forward for this big event, Mr Guadalupe comments.

The luxury smartwatch industry is very diversified. Apple Watch is the market dominant, but other luxury watchmakers like Louis Vuitton, Hermes and Tag Heuer are also in the markets with their smartwatches. In the LVMH Group, the development of the smartwatches, is being taken care of the internal development unit.This is also the way the Group can have efficient R&D expenditures. 

It is estimated that the global smartwatch sales would exceed 141 million units this year, while the estimates for the last year were 75 million units. In 2016 the sales were 38 million units.

Hublot was the first luxury brand to invest in football and has partnered with football for over 10 years and the company has different brand ambassadors like Pele, Usain Bolt, Dwyane Wade, Justin Rose, Dustin Johnson and Lang Lang.

The company has worked with the luxury car manufacturer Ferrari for many years and according to Mr Guadalupe some kind of connected smartwatch with Ferrari might be one option in the future.. The autonomous, connected cars can have also new innovations for smartwatches.

-When we work with smartwatches, it is good to remember that it is totally different market compared to mechanical watches, which is our core business. But working with wearables we want to show the innovative, unique and piece of art work in our products, he says.

The launched Hublot Big Bang Referee smartwatch enable users to take part in the FIFA game by sending them notifications and live score updates.The company says they have produced 2000 units of this watch so far.

Hublot and sustainability

As part of the LVMH Group, Hublot has also developed tools to track for example the raw materials in the luxury watches. Sustainability is becoming more common and part of the luxury watch industry processes more.

-We use different raw materials like gold, diamonds and titanium in our products. Sustainability means for us that we track the sourcing of the materials as good as possible and want to expand that analysing and recycling also in the future, he explains.

Quality, passion and details

But what does the CEO do at home?

-I am a football fan and therefore it is a pleasure for me to work in collaboration with FIFA. This is a third World Cup for me. And when I am at home, I like to cook. Gastronomy is my hobby as well  You know: it is like watch making: quality, passion and details, he says.

© Päivi Härkönen, ComteamPUB+

Lifestyle Tech

Hublot to launch smartwatch-straps in October

 

The Swiss luxury watchmaker Hublot, part of the global French luxury group LVMH (MC:FR), is planning to enter the smartwatch industry. According to its CEO Ricardo Guadalupe the company is developing the new fusion in Silicon Valley, California with a software company.

 

  • We are planning to launch it in October this year and the main idea is that we will keep the traditional watch as it is, but we will add the smart part of the watch in the strap. We will operate both with Apple and Android systems, Mr Guadalupe said to pubplus.club during the BaselWorld2017 in Basel, Switzerland.

 

Hublot is one of the few luxury watch companies that has survived the industry downturn with growth figures. According to the company information, Hublot´s revenue growth last year was 4 %, while in the industry the fall was nearly 10 percent.

 

  • The luxury watch industry has suffered from the Chinese economy, but for Hublot this has not been the case, while most of our watches has been bought by customers in Japan, US and Middle East. And our customers value our strategy of fusion, for example we use different kind of materials in our watches, he said.

 

Hublot has developed watches with different kind of material fusions like Carbon and Leather, Titanium and Ceramic and Gold with Textiles (like linen, jeans or also vintage fabric).

 

One of the innovations is also Magic Gold, which is a completely new type of gold developed by Hublot.  An expert fusion of ceramic and liquid gold, 18K Magic Gold must, like all other 18K alloys, be composed of 750 ppm pure gold; but the inclusion of ceramic has made it the world’s first scratch-resistant gold, unlike traditional 18K gold.

 

These innovations and the desire to be near customers through sports and arts have resulted for example the long partnership with Ferrari.

 

Ferrari is celebrating its 70 years this year and Hublot is also launching a new Ferrari watch to celebrate the milestone. This Big Bang Ferrari is one of the Ferrari watches Hublot is making every year. Techframe is a new timepieces presented during Baselworld to tribute to this anniversary and will stand alone next to the Big Bang Ferrari collection.

 

Hublot is based in Nyon, Switzerland and it has 70 boutiques globally. Last year the company opened its New York flagship boutique in the Fifth Avenue.

Päivi Härkönen

 

Hublot CEO Ricardo Guadalupe

Ferrari watches by Hublot

Classic Fusion Italia Independent Watch

The Art of Fusion – Magic Gold by Hublot

The final testing of watches

 

Lifestyle Tech

Ferrari to be listed in the New York Stock Exchange

The Italian luxury car manufacturer Ferrari is going to make its IPO in the New York Stock Exchange. According to Reuters, the sale will consist of 17,2 million shares (9 %) of the Dutch holding company Ferrari NV. The share price is exptected to be at 48-52 dollars. The ticker for the company will be RACE.

Investors are expected to be highly interested of this IPO and the lead coordinator is UBS altough the car industry has faced the recent Volkswagen´s emission testing scandal. The valuation of the company could rise to 9,8 billion dollars and the enterprise value would be around 12 billion dollars.

The parent company Fiat Chrysler Automobiles is exptexcted to cut the debt and to help finance a 48 billion euros investment programm of Jeep, Alfa Romeo and Maserati.

Ferrari´s chairman Piero Ferrari is said to keep a 10 percent stake in the company. He has said that Ferrari is not a traditional car manufacturer and its peer group should rather be Hermes and Prada than for example Porsche. – We don´t sell a car, we sell a dream, he said in an interview in Bloomberg.

Ferrari´s revenue last year was 2,8 billion euros and the company sold 7255 cars. The waiting list for a Ferrari is exptected to be one year. The company earnings before interests and taxes were 389 million euros.

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