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Technically born in 1943 as a distributor of high-end European brands in Portgual, The Wakmann Watch Company moved to New York in 1946. A year later, the company formed a joint venture with Breitling. Wakmann went on to produce its own watches, as well as watches in partnership with Breitling.
The Wakmann Watch Company: An Opportunity To Act
The primary reason that the company made the jump “across the pond” – landing in New York – was to take advantage of American restrictions on Swiss watch imports. During WW2 the powerhouse US domestic watchmaking industry focused all of its efforts on wartime production. This left a major gap in supply during the war, and placed American watchmakers at a disadvantage.
Swiss watchmakers could still produce watches for civilians, and Swiss imports accounted for just over 60% of the US watch market by 1941 as a result. American Protectionism continued to set in, and the government decided to support the US watchmaking industry with what’s loosely referred to as The Swiss Watch Import Act. In support of domestic industry, the US government decided to limit the amount of watches and movements that could be imported each year.
Where It All Started
A 1936 trade agreement between the US and Switzerland led to the reduction of several tariffs being applied to Swiss watches. According to The New York Times, this ended a “Serious Rupture in Trade Relations as Result of Tariff Act of 1930”. Prior to the 1936 agreement, the duties imposed by the 1930 Tariff Act created some unintended consequences – the smuggling of both watches and parts. US law required all items seized by customs be auctioned off, and so ironically, it ended up being detrimental to both the US and Swiss manufacturers (because the watches and parts ended up in the US market anyways).
World War 2 came to a conclusion during the end of 1945, but the US watch industry, which was only producing watches for the military, had already lost a large amount of market share to the Swiss.
The Partnership With Breitling
Fast forward to 1946, or the year Wakmann set up shop in New York. American and Swiss governments agreed to maintain quotas that restricted the export of Swiss watches and movements from Switzerland to the US. This allowed firms like Wakmann to import and distribute watches in a very large consumer market with a domestic industry that wasn’t yet “up and running” to its full capacity.
After striking a deal and creating the joint venture with Breitling, Wakmann began importing and co-branding clocks with its new partner for US military (and civilian) aircraft. Wakmann continued to act as an assembler of incomplete watches and watch movements, and by doing all of this on US soil, was able to avoid paying added taxes. The below ad dates to approximately one year after the Breitling joint venture was established:
Marching Forward From the Forties Onwards
The 1940s came to a close, ushering in a new era. Swiss market-share was “here to stay” and many American brands, like Wakmann, had already adapted to this paradigm shift. Companies like Gruen and Bulova were sourcing Swiss movements and casing them in their own watches already. Gruen had actually been casing Swiss movements for quite some time as an American company with Swiss production facilities.
in 1954, President Eisenhower triggered the escape clause of the 1936 Trade Agreement. This raised tariff rates on Swiss watches again. The Big Three at the time – Elgin, Hamilton, and Waltham – insisted that the Swiss imports were killing their businesses. They argued that this was a matter of national defense, and that the US needed a self-sufficient and functioning domestic watch industry.
Conclusion
As an importer (mostly for Breitling), and a producer of its own watches, Wakmann continued to thrive through the 1950s and 1960s, but was hard hit by the Quartz Crisis. In 1967, Lyndon Johnson eventually ditched the escape clause set in motion by Eisenhower, which meant that tariffs would be set back at the lower rate.
This resulted in a 50% reduction in tariffs on imported watches by the start of 1972, but it was too late. It was found that the tariffs didn’t really help much in stopping the plunge in domestic production, anyways. By then, the American watchmaking industry had all but dried up. Even the Swiss watch industry was gasping for breath at that time because of a new threat – the quartz watch.