Most Americans think of the Swatch as a trendy timepiece that was embraced by everyone from K Mart shoppers to the owners of SoHo galleries. But in its country of origin, Switzerland, the Swatch represents nothing less than an amazing instrument of industrial rejuvenation. Before it came along, the Japanese had more or less usurped the Swiss as the heavyweight champions of the watch business by substituting their cheap and reliable digital technology for Switzerland's legendary craftsmanship. The question now is whether that industrial formula can work for -- of all things -- automobiles.
Make way for the Swatchmobile, a sassy two-seater that looks like a cross between a Volkswagen Beetle and a Rambler. In fact, it is the product of an odd corporate marriage sealed last week between Mercedes-Benz, the maker of luxury cars, and Nicolas Hayek, the man who put almost 150 million Swatches on wrists all over the world. So far, the two companies have worked on separate prototypes, which they plan to merge into a single model produced by a joint company (Hayek's stake is 49%, Mercedes' 51%) for the 1997 market.
The car still exists mostly in the minds of several dozen young engineers in jeans and sweatshirts who have spent three years working around the clock inside a secret garage in the Jura Mountain town of Biel. If the team realizes its vision, the Swatchmobile will combine the crash resistance of a Mercedes with the spunkiness of the famous wristwatch. Plans call for the Swatchmobile to be 20% smaller than a typical subcompact, able to wheel into a parking space sideways, cost about $10,000 and reach 90 miles an hour. The car's designers hope it will travel at least 80 miles on a gallon of fuel, thanks to an engine one-tenth the weight of any existing engine with equal power. Models will run on gasoline, electric power or a combination of both.
For Mercedes and Hayek's company, the Swiss Corp. for Microelectronics and Watchmaking Industries (SMH), the project is not just a technological challenge but also a huge marketing risk. After all, business-school casebooks are full of stories about fashionable companies that, in search of diversification, stretched their brand names past the breaking point. Swatch tried to extend its name to telephones, pager watches and sunglasses without great success. But Mercedes, whose sales have fallen 11% in the past three years, is eager to reach out to buyers who cannot afford its traditional cars. Already the company has unveiled plans to produce in 1997 the compact four- seat Vision A with a sale price of about $18,000.