Wednesday, July 20, 2016

You Get What You Pay For! Not Always...

Contrary to popular belief out there, Hanhart is apparently still in the business of making watches.  Based on their most recent newsletter you might be forgiven for not knowing this.  The news was all about -

Courtesy of Hanhart
The Abu Dhabi Desert Challenge (1 – 7 April 2016) is always the season start for the X-raid Team. The rallye is one of the most popular events of the year, because it takes place almost completely on sand and dunes of the Liwa desert. Moreover, it belongs to the most prestigious international cross-country races worldwide!

The Abu Dhabi Desert Challenge is the favourite event for the Hanhart fan and brand ambassador Stephan Schott and his long-time co-pilot Holm Schmidt, not least due to the success in the last year. There has been much rejoicing for Schott and his former co-pilot Andreas Schulz, who made the 5th position in the overall ranking. They made it into the Top 10 at all stages and got through the desert of Abu Dhabi without greater problems.  

This year, the Hanhart team respectably ranked 18th. Certainly, a bit more might have been possible, if the two pilots would have not received that much penalty time due to an accident in the third stage. Everything was going well so far until the Hanhart MINI suddenly frontally crashed into another vehicle, which was stuck in the dunes. The clutch of the MINI was damaged and the two pilots unfortunately had to finish the stage earlier. Nevertheless, they properly caught up to make up the lost time. Schott and Schmidt ranked 11th after the final stage and came in the 18th in the overall ranking.

So clearly Hanhart is not spending a lot of money on copywriting, but apparently does have money to throw at a vanity partnership like this.

But then, I guess, Hanhart blew all of their allowance money on this partnership because...


Over the past few years, the prices of high quality materials have increased significantly. Hanhart increases the price of the entire collection on 1 September 2016. The main reason are the increased purchase prices for base movements from Switzerland due to the exchange rate between the euro and Swiss franc. Since the release of the fixed exchange rate by the Swiss National Bank, Hanhart has not raised the prices. Now this development has to be taken into account.

Now this is particularly interesting when you take a few facts into account -

1. There is, in fact, an oversupply of movements out there. I am not a Nobel Prize winning economist, but I am somewhat acquainted with the idea of supply and demand.

2.  ETA is actively trying to shift as many movements as they can right now.  Again, it is safe to say that at this particular moment, it is not exactly a "seller's market".  Meaning I don't actually think the price of those things have gone up to the extent that Hanhart would have you believe.

3.  The entire industry is struggling right now with reduced orders, therefore it is reasonable to assume that the other contributors to the Hanhart watch (straps, cases, crystals, etc.) are most likely going to be offering better terms.

Essentially, what Hanhart would have you believe is that there is an inelastic demand for their watches.  Meaning that no matter what the price, people will still want them ; )

Sorry,  I'm calling bullshit on this one.

If I've said that GP and Eterna are cursed, I am starting to feel more and more that Hanhart was born under a bad sign.  For those of you not familiar with the expression, here is an explanation courtesy of our friends at Urban Dictionary -

A saying that relates to astrological signs. A person uses this saying when they believe they are unlucky. There are no 'bad signs' in astrology, but according to legend Capricorn and Scorpio are considered bad signs.
Ferris Bueller: I asked for a car, I got a computer. Hows that for being born under a bad sign?
by QueenofTheSouthside May 16, 2014

Hanhart has been passed around like a red-headed step-child from owner to owner, and it still does not seem to have decided what it is and how it will do things.  Spending money on partnerships and sponsorships while claiming that times are tough is not what customers want to hear when they are being asked to pay higher prices while looking at dusty rally cars and shiny airplanes.

But the good news is that those higher prices you are paying for your new Hanhart are  clearly justified and going to fund important developments in watch making, like this -

Courtesy of Hanhart

The Villeneuve Air Cup is the first French aerobatic contest of the season, organised by the AĆ©roclub of Villeneuve in the south west of France. It is particularly attractive for those ambitious pilots, who are willing to rise their level for major competitions.

Bastien LeRoux’ noticeable progress since the last training period was evident: Hanhart’s young and talented brand ambassador succeeded with his XA42 aircraft by XtremeAir in taking the second place in the overall ranking and even the first place in the unknown sequence. The competitors must not practice the unknown sequence, which is announced to them only about 12 hours before the competition.

Thus those results confirm not only Bastien’s promising talent and successful future, but also his solid position in the advanced group of French aerobatic pilots. The next challenge for Bastien will be the French National Championships, where he has the opportunity to receive his ticket to the 12th FAI World Advanced Aerobatic Championships 2016 in Poland (04 August to 14 August 2016).

We congratulate Bastien LeRoux and the aerobatic aircraft producer XtremeAir on the first achievements of this season and keep our fingers crossed for the upcoming contests!

So when you ask yourself what that extra money went for when you purchased your new Hanhart - you can feel warm and fuzzy inside because you helped support Bastien LeRoux's aerial acrobatics!

Customers deserve better.

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