As a general rule, you don’t find a lot of metallurgists running luxury watch companies. The exception that proves the rule is Thierry Esslinger, who took over as CEO of Switzerland’s Montres Breguet last September.
Previously, Marc Hayek had been both president and CEO of Breguet. He took over the posts in 2010, upon the death of his grandfather, Nicolas G. Hayek, Sr. But as a member of the family that manages Breguet’s parent company, the Swatch Group (and which controls the largest number of shares), Hayek wears a lot of hats. (His mother, Nayla Hayek, is the group’s chairperson. His uncle, Nick Hayek, is the group’s CEO.)
Last year, Marc Hayek’s corporate duties increased. He joined his mother and uncle (along with actor George Clooney) on the board of directors of Belenos Clean Power Holding, AG, a producer of batteries for electric cars. The Swatch Group holds a majority share of the firm. Marc Hayek is also head of the Swatch Group’s Blancpain and Jaquet Droz watch brands. Something had to give.
“There was not enough time [for me] to keep the responsibility to do the operational side of [Breguet]” Hayek told me earlier this year. “We needed somebody to manage the daily business.”
Enter Esslinger. For more than two decades, the metallurgist had worked at Hayek Engineering AG in Zurich, the consulting company that Hayek Sr. founded in 1963. Hayek Sr. hired Esslinger in 1995 and eventually brought him into the firm’s management.
Over the years, Esslinger had worked as a Hayek Engineering consultant on various Swatch Group projects. “Mr. Esslinger was already in the family for a long, long, long time with Hayek Engineering,” Hayek said. “He worked with my grandfather for many years, not only at Hayek Engineering, but also at Breguet.”
Hayek remains president of Breguet, involved in corporate strategy and product development. As CEO, Esslinger oversees daily operations. “We are very, very close,” Hayek said. The two talk about Breguet matters daily.
Recently, Hodinkee met with Esslinger at Breguet’s boutique in New York City to learn more about him and developments at Breguet.
Hired By Hayek Sr.
Alsace-born Esslinger was in his early 30s when he joined Hayek Engineering. He had been working at a factory making zinc ingots in Germany’s Ruhr region. Hayek Engineering, he says, was a big change. “It was a new world — a consultancy working with Mr. Hayek, Sr. It’s not such an easy thing,” he says with a laugh. “You had to fight to earn the position. But it was incomparable training for me,” he says, “very intensive.”
In addition to his engineering degree, Esslinger holds a C.A.A.E. (the equivalent of an MBA) from IAE in Paris, one of France’s most prestigious business schools. But as good as that education was, it paled in comparison to working with Hayek, Sr. Hayek Engineering “was a very, very good school, I can tell you,” he says, smiling.
One of Hayek Engineering’s top clients was the Swatch Group. No surprise there. Hayek Engineering literally created the Swatch Group. In the thick of the quartz crisis in the early 1980s, the Swiss banks bailing out the watch industry asked Hayek Engineering, Switzerland’s top consulting firm, to devise a recovery plan for the embattled industry.
Hayek Sr. and his team did, proposing that a new company be created out of two giant watch conglomerates that were hemorrhaging red ink. When the banks urged Hayek, Sr. to execute his own plan as CEO of the proposed new company, he agreed. However, he continued to own and run Hayek Engineering. (Today, Nayla Hayek heads Hayek Engineering.)
Over the years, Hayek Engineering has performed various services for the Swatch Group. Which is how Esslinger got to work with, and in, the group.
“For Swatch Group companies, I worked principally on production plans to improve efficiency and productivity,” he says, as well as master plans and turnaround projects.
In that vein, he twice served as interim CEO of a Swatch Group production company, Lascor SpA, in Italy. It was a job that was right up his metallurgical alley. Lascor manufactures cases and bracelets, as well as steel, aluminum and precious metal composites.
He was also a troubleshooter for the Swatch Group. For example, a decade ago, Breguet sponsored a major renovation of Le Petit Trianon buildings at Versailles palace, beloved by Queen Marie Antoinette, who was a fan of Breguet watches. (Company founder Abraham-Louis Breguet opened a watch workshop in Paris in 1775.) Montres Breguet was responsible for the entire cost of the project, which amounted to millions of euros. Esslinger, as a Hayek Engineering consultant, served as controller on the project. During the renovations, he went to Versailles every week for more than a year to check on the progress of the construction to assure that the work was done on time and on budget.
Calling All Gentlemen
Esslinger’s expertise is primarily in production and operations. Since joining Breguet, he has been boning up on the marketing and distribution side of the business. One of the reasons he was in New York was to host an event at Carnegie Hall to promote the Breguet Classique, the firm’s leader collection and its largest. Breguet bills the event, called the “Classic Tour,” as a salute to the modern gentleman.
“We have developed a concept around the image of a gentleman,” Esslinger says. “The purpose of the tour is to show something of the life of a true gentleman.” The event, which Breguet is holding in major cities around the globe, celebrates craftsmanship. Chiefly, the Classique Collection with its famously classic style, designed two-and-a-half centuries ago by the founder: fluted case-bands; engine-turned gold dials, often with several guilloché patterns; blued moon-tipped Breguet hands, and Arabic numerals. At the New York event, guests could meet Breguet master watchmakers, who demonstrated the art of hand-made guilloché on a watch dial. Also on hand were a bespoke tailor, a personalized shoe-care specialist, and a cigar roller.
Movements With Magnets
For watch aficionados, the Classique collection is perhaps better known as the showcase for Breguet’s innovations in high- mechanical technology.
That’s because when the Swatch Group acquired Montres Breguet and its movement producer Nouvelle Lemania in 1999, Hayek Sr., who installed himself as CEO, made technical innovation a top priority for the firm. Abraham-Louis Breguet, after all, was a technical wizard, with a long list of horological inventions and innovations to his name (the tourbillon, pare-chute anti-shock system, the Breguet balance spring, etc., etc.).
Hayek had an in-house research and development laboratory built from scratch in Manufacture Breguet in the Vallée de Joux. The goal, he said, was to make watches that Breguet would make were he alive today.
Since then, Montres Breguet has invested heavily in high-mech research designed to improve precision using new solutions like silicon components and ultra-high-frequency movements. That work continues, Esslinger says. He cites one of the firm’s biggest breakthroughs: its patented magnetic pivot technology, which harnesses the power of magnetism to improve the precision and reliability of a mechanical watch.
Because silicon components are immune to magnetism, Breguet was able to use powerful micro-magnets to create a magnetic field around the balance staff. The magnetic field serves as a shock protector for the staff, improving its rotation and stability. Breguet thinks the technology could be a game-changer for mechanical watches.
“We have this technology in one watch at the moment,” Esslinger says. That’s the Classique Chronométrie 7727, introduced in 2014. “But we want to develop this further.”
Breguet has. I saw the next step in a meeting at Baselworld in March with Esslinger and Marc Hayek. Nakis Karapatis, head of Breguet’s R&D lab, showed me a prototype of what Breguet calls an “experimental balance wheel.” (Technically, it is Project XB5.0. The X stands for “experimental” and the B for “balance wheel.”)
It’s a new type of escapement for which Breguet engineers removed the anchor and added magnets. The technical details are secret. The bottom line is that this escapement does not have stop-and-go motions. Breguet tests of the prototype show significant improvements in efficiency and accuracy. Which should yield a much longer power reserve.
Karapatis’s team has been working on the escapement for two years. There will probably be another three to five years of development and testing before Breguet puts it in a watch, Karapatis said.
This kind of technical innovation is time-consuming and costly, Esslinger says. “But we need these innovations. We have to find other new technologies. Because it’s the DNA of our brand. Breguet was an inventor and we have to respect this heritage.”
Other innovations are on their way, of course. “I cannot tell everything we have in our pipeline,” he says. But he notes that the tourbillon, Breguet’s most famous invention, has seen improvements over the years in aesthetics. But not so much in tourbillon technology. “We are looking for that. We want to push this.”
Also, acoustics. “We are researching in this field. There is a lot to do there, for musical watches. It’s one example.”