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This from JC Babin the CEO of TAG posted at OTD Heuer resource I have spoken to him there and found him to be pretty cool!

Hello everyone on onthedash.com ! I’m JC, the CEO of TAG Heuer and first and foremost wish you all a very happy new year thanking you for your passion for Heuer and TAG Heuer. As indeed there has been a controversy on our new Calibre 1887 movement, I owe you some direct and personal explainations so that as Heuer specialists and passionate lovers you have a direct understanding of what’s going on.
Like in 1968 when Jack Heuer luanched the Cal11 project teaming with several partners, we decided more than 3 years ago, instead of re-inventing the wheel (which we did on the Monaco V4, currently being launched with already 85 units delivered out of the 150 from the 150 years limited edition, to acquire some IP rights from Seiko Instruments Inc. in Japan as they had developped a remarkable construction never industrialized nor really developped in large quantities, an named TC78.

This IP was very interesting as allowing us to bridge the gap between our modular 28.800 alt Dubois-Depraz Cal 11 and 12 (Monaco, Silverstone) and our integrated 36.000 alt Calibre 36 done on a Zenith El Primero base. The TC78 IP was matching virtually all our requirements in terms of architecture (integrated, column wheel, oscillating pinion), versatility, evolutivity rather than performances, reliability and potential for important productions at reasonable costs. We obviously could have somehow gone around that IP as many Brands would have done, coming up with a slightly different construction but that would have been highly unethical. Therefore we contacted SII and had the chance to find highly competent people just eager to see their great IP becoming a real volumetric high end movement as until then SII had only produced few thousands only but never really industrialized it.

And so the work started which basically was like developping a new movement from scratch as our swiss team in La Chaux-de-Fonds, redesigned entirely the blueprints filing them legally in Switzerland, re-developped several key components, decided to move to a swiss assortment and changed the dimensions slightly enlarging the diameter but reducing the thickness. All plans have been developped in Switzerland as well as all the prototyping. Initial prototypes were powered by a SII assortment until we decided to change for a Nivarox FAR specific development as Nivarox FAR had some capacity to do that unlike in 2007 when we first asked them (at this time remember the market was up 15% a year an no Company had any capacity).

In parallel we invested more than 20 mio $ in state of the art dry automatized milling technology allowing to produce internally in La Chaux-de-Fonds the main plate and bridges at speeds, costs and micron-precision unheard before in the industry (and being oil-free it’s also greener than any other watch factory in Switzerland), getting close to 100% of pieces accepted without corrections ! we also have developped with another swiss company the 1st ever fully automatized jewels setting automat, capable to sort and pick-up the right stones under a micron-camera video-computerized control and setting the jewels on the plate and bridges again at an incredible speed with utmost precision and again very limited fall-off.

We work with 22 suppliers, including 21 from Switzerland and SII from Japan supplying some screws, pionions and cut parts.
The controversy was born out of two factors probably – fuelled by “smart” competitors perhaps – which I would summarize as follows:
- we wrongly did not mention the IP in our Press Release and surely were too bullish in our “100% home-made” statements as indeed many parts are made by other swiss partners and not entirely by us. Said that we already do internally more than many so-called Manufactures !
- we acquired a japanese IP which apparently is a sacred cow in our Industry ! Indeed, in the recent past several other high end Brands have acquired IPs from competitors to develop their own movements but this created no big issue as these competitors were either swiss or german.

I have underestimated the emotional dimension of Japan for most swiss companies. Probably an american IP too would have created a lot of controversy too as well as wrongly american watches are snobbed by many swiss companies like japanese – as if some countries were allowed to have good watchmaking ideas (Switzerland, Germany) and others not (Japan, US…)?

In a global world one has to take the best where it exists. So was the TC78 IP. And this is what we did. This does not prevent our movement to by by all means SWISS MADE !!!!
Said that TAG Heuer is perfectly capable to come up with its own IP and patents when it’s not about doing something conventional but really revolutionary like a Caliber S or the Monaco V4 not to mention the Caliber 360. But even if the V4 IP is TAG Heuer’s and 100% swiss, still its belts are french…………is it a sin ?

I should ask to our detractors.

Since that controversy the Swatch Group has disclosed its intention to stop supplying the Industry of movements and parts such as the assortments. It has created a lot of buzz, at least in Switzerland. We read the newspapers like anyone and take good note, assessing scenarii and options should it materialize as Swatch Group claims they will do it. Today we are one of the major Clients of ETA in terms of mechanical movements but also hands and we are very happy with their quality, service and customer-focus. Now if they want to stop we’ll find some other ideas but it would be a pity as we ever worked with them, at least since the early 1980′s and are probably one of their oldest, largest and most loyal Customer over the last 25 years. We have gone thru 150 years of history and nothing will prevent us to write another 150 years anyhow.

So let’s wait and see. You’ll be amazed by the Caliber 1887 and judge it by yourselves. Now, a bet ? In which series will TAG Heuer launch it in Basel 2010 ?
Best regards and Happy new year –

JC Babin