Nicolas Hayek's low-cost Swatch rescued the Swiss watch industry in the 1980s

In the late 1970s and early 1980s the Swiss watch industry was being destroyed by cheap Japanese quartz watches; the two big Swiss groups, SSIH and ASUAG, were in serious trouble and component makers were running out of orders.

Nicolas Hayek, who ran a consulting firm, was hired to devise a strategy. In 1983 he recommended merging SSIH and ASUAG into a single company, SMH, and launching a low-cost, high-tech watch called the Swatch, made with automated production and few parts.

The Swatch was launched on 1 March 1983 and was an instant hit; it sold a million in its first year and 3.5 million by the end of 1984. It was cheap, fun and collectible, and it drew in people who had never thought of wearing more than one watch.

The volume product also revived the group's premium brands. By 1989, with Hayek as CEO, SMH was the world's largest watchmaking company, and the Swiss watch trade had been rescued.

The Swatch sold a million in its first year and 3.5 million by end 1984, and by 1989 Hayek's SMH was the world's largest watchmaking company.

Merging SSIH and ASUAG into SMH concentrated capacity and ended duplication.

The Swatch's automated, low-part-count design allowed a genuinely cheap high-quality watch.

Its price and style created a new mass market of fashion buyers, not just watch collectors.

The cash and attention from the Swatch gave the money-losing luxury houses time and capital to recover.

When cheaper foreign competition guts a premium industry, cost cutting is not enough; a radically cheaper, high-volume product that reaches new customers can fund the revival of the premium lines.

The Swatch became a global fashion icon and the Swatch Group grew into a conglomerate spanning Swatch and the prestige houses, with Hayek at its head for decades. The dark episode also hardened the industry's resolve to keep watchmaking in Switzerland, and the Swatch became the model for using a low-price volume brand to fund luxury.