The advent of more reasonably priced quartz timepieces in the 1970s precipitated what is known as the Quartz Crisis, a period during which the Swiss watchmaking industry came dangerously close to collapsing. Both Asia and the United States came to dominate the business, with Hong Kong being the country that shipped the most electronic watches abroad in 1978. This incident had a significant impact on the economy and watchmaking industry of Switzerland, the aftereffects of which may still be felt to this day.
When Japanese manufacturers first began producing quartz watches in large quantities in the early 1970s, the Quartz Crisis was just beginning. Traditional Swiss mechanical watches were far more expensive and less accurate than these timepieces, which were made in Japan. The Swiss watch industry, which was already ailing owing to the oil crisis of 1973, had a significant decline as a direct result of this event.
By 1978, Hong Kong had established itself as the world's largest exporter of electronic timepieces, while the watch industry in Switzerland was on the verge of bankruptcy. The economic situation in Switzerland was severely impacted by the Quartz Crisis. The watchmaking industry was one of the primary pillars of the Swiss economy; consequently, the industry's downfall produced a ripple effect that could be felt throughout the entire country.
A significant number of watchmakers were compelled to shut down their operations, and the Swiss government was required to provide financial aid to the industry. In addition, the decrease in the value of the Swiss franc that the Quartz Crisis brought about made Swiss exports less competitive. Even though the Swiss watch industry has fully recovered from the Quartz Crisis, it is still experiencing some of the after-effects of the crisis.
Because of the economic downturn, the watchmaking sector is significantly less than it was before the crisis. Many watchmakers have either retired or relocated to other countries. The Quartz Crisis was a significant event in Swiss history, and the repercussions of that crisis can be felt even now.