Rolexit: The Death of Baselworld?

Exiting unions, agreements, and organizations has been all the rage in recent times and this phenomenon struck the watch industry on April 14, 2020 when Rolex, Patek Philippe, Chanel, Chopard, and Tudor announced they were leaving Baselworld with immediate effect.[1] Hindsight being twenty-twenty this announcement should not have come as a surprise.[2] The first clear indication of something big being afoot came on April 6, 2020 when Hubert J. du Plessix, the president of the Baselworld exhibitors committee, released a letter, a letter that was a powerful shot across the bow reminding Baselworld not to bite the hand that feeds it. The letter was a warning shot because of Hubert J. du Plessix’s side gig as Rolex’s head of investments and logistics. This letter read like a Festivus airing of grievances and seemed to suggest that the case was being made in public that Baselworld had been and continued to act in bad faith in performance of their contractual relationship with Baselworld exhibitors. Now I know what you are thinking, Swatch group, Seiko, Citizen, and Breitling have already pulled out of Baselworld, surely Baselworld or more specifically MCH the corporation behind Baselworld, would take notice and do everything possible to keep Rolex happy.[3]

However, the director-general of Baselworld, Michel Loris-Melikoff, responded with what should have been the now expected come-at-me attitude that has gotten Baselworld into this mess. MCH missed the warning in Hubert J. du Plessix’s letter, the warning that the King wasn’t happy with recent developments. MCH’s hubris was in believing that Rolex needed them more than MCH needed Rolex or perhaps they thought Rolex’s deep pockets and infamous focus and evolution over revolution ideals would keep Rolex at Baselworld. MCH and Baselworld should have heeded Omar’s advice, “when you come at the king, you best not miss.” Now the king has struck back and perhaps struck a deathblow to Baselworld.

Unsurprisingly, MCH responded to the announcement of the Rolex led exodus with what has become their trademark petulance by releasing a statement that essentially tries to blame the pandemic and stating that exhibitors were aware of and supportive of the changes.[4] This one particular line in the statement best exhibits MCH’s petulance,

“The MCH Group must therefore conclude that the relevant plans have been in preparation for some time and that the discussions concerning the financial arrangements for the cancellation of Baselworld 2020 are now being put forward as an argument.”

Scottish Watches and Edinburgh Watch Company

This statement is petulant because it’s a demurrer worthy statement, which is just fancy legalese for “so what?” This statement is frankly just embarrassing because if taken a face value would suggest that MCH could not even fathom Rolex or Patek would leave Baselworld. Surely, any rational person would have assumed that at least since Swatch group pulled out of Baselworld Rolex and Patek and everyone else was also thinking about leaving. Swatch group leaving gave Rolex and everyone else a case study to evaluate life after Baselworld and to study to see what to do or not to do after leaving Baselworld all without assuming any of the risk by being the test case. I personally doubt this Rolex exodus has been that long in the making, I am willing to bet it was all done in response to MCH’s handling of the postponement of 2020 Baselworld. However, I do believe Rolex and the other exhibitors have been talking to each other at least as long as since Swatch pulled out in the sense of taking a straw poll just to see if the situation ever reached a tipping point if other exhibitors would be willing to walk out that door with Rolex. The fact that MCH did not sense the danger of Swatch group leaving illustrates how ineptly MCH and Baselworld has been run.

Now, it may be unfair to assume that this one statement reveals corporate incompetence. This statement may have been posturing in the public’s eye much like Hubert J. du Plessix’s letter. This statement may suggest that MCH may be exploring the idea of lashing out at Rolex for leaving. MCH may be suggesting that they are considering legal action suggesting that Rolex and the others have acted in bad faith. I have no knowledge of Swiss law or Swiss civil law in general but there is a legal theory in common law countries of tortious interference with business contracts and my reading of the MCH statement, especially the MCH focus on the exhibitors talking to each other, seems to be suggesting that MCH is at least thinking about exploring this idea or a similar concept.[5] For me this would be a mistake. MCH needs to accept that it’s over; it’s time to move on.

 

If I were MCH I would be thinking about turning these lemons into lemonade. First, I would be bending over backwards to make sure the LVMH brands, Tag Heuer, Hublot, Zenith, etc. (but not Bulgari) were happy and staying at Baselworld.[6] Next, I would be going back to Swatch Group begging them to come back with the lure being Baselworld still has name recognition and history but more importantly that Baselworld could now be THE Swatch show. There is now no more Rolex stealing the Omega hype at Baselworld, which is arguably a nice selling point for MCH.

MCH may lament Baselworld as another victim of the coronavirus but this is all of MCH’s own doing. So is MCH the loser in this situation? Sadly no. You and I are the real losers in this situation. The Rolexit brands announced in their statement that they would be creating a new show for “retailers, the press, and VIP customers” with no mention of the general public.[7] So it seems that Rolex will be creating another waiting list, a waiting list for you and I to get into this new show. It seems that us watch lovers are the real losers here; we are the ones being denied our chance to make that pilgrimage to Baselworld. Rolexit will have lasting effects on the industry and Baselworld but only time will tell how these changes will affect us, the consuming enthusiast.

[1] https://watchesbysjx.com/2020/04/rolex-patek-philippe-withdrawal-baselworld.html

[2] http://www.scottishwatches.co.uk/2020/04/14/what-happens-in-basel-stays-in-geneva/

[3] https://watchesbysjx.com/2018/07/breaking-news-swatch-group-to-leave-baselworld-fair-in-2019.html

[4] https://www.mch-group.com/en-US/news/medienmitteilungen/2020/04/baselworld-200414.aspx

[5] This is not legal advice or legal commentary on any legal issues or rights related to any contracts that may or may not exist between the parties. I have no knowledge of Swiss law or Civil Law countries. If you have any legal questions or concerns, please consult a licensed legal professional in you jurisdiction.

[6] https://watchesbysjx.com/2020/02/bulgari-departs-baselworld-2020.html

[7] http://www.scottishwatches.co.uk/2020/04/14/baselworld-if-corona-doesnt-get-you-the-coronet-will-the-rolex-initiative/

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