Swatch Out! Watchmaker Plans To Take on Japanese Carmakers

NO one knows yet if its colors will be wild, if it will revolutionize technology in its field, if it will win back a market progressively abandoned to the Japanese, or if it will be called, say, Swauto. For now, it's called simply the Swatch car.

The man who proved, with a watch called Swatch, that the Japanese are not better at everything, is planning to enter the car business. In as little as three years, Nicolas Hayek promises a high-volume, high-quality car that will appeal to the kind of people who bought his inexpensive Swiss-made watch when everyone said it was time to abandon watchmaking to the Japanese.

Mr. Hayek is serious about succeeding as an automaker. For every person snickering that a car is infinitely more complicated than a watch, there is an auto-manufacturing executive inquiring about a possible joint venture on the Swatch car. But Hayek freely admits that his latest project is also a lesson in progress for American and European manufacturers whose response to the Japanese is to try to shut them out.

``People must wake up to realize that you do not win this kind of war by going on the defensive with customs barriers and other constraints,'' he says. ``You have to fight back at their level, with a high-quality, high-volume, and low-cost product.''

Hayek peppers his speech with references to war, and with allusions, aimed at his fellow Europeans, to deep sleep.

``Don't misinterpret me, I love the Japanese,'' he says. ``Without them we would all be sleeping very deeply, especially here in Switzerland.'' But he says there should be no misunderstanding the Japanese: ``When they attack a market, they want it completely. By winning the high volume in the middle,'' he says, ``they can move to the luxury sector,'' where returns are higher.

Hayek, whose Zurich company SMH is the world's largest watchmaker, says his car will embody the qualities that have made his watches, and more recently his telephones, a success. ``It will be unusual, provocative, and fun.''

And, he says, it will be ``ecological.'' Some observers guess that means electric.