Clash of the Angry Swiss Watchmakers

Let's say you go to a jewelry shop to buy your spouse a Swiss watch. Many thousands of dollars later, the timepiece is on his or her wrist, ticking with that steady purr that indicates the best workmanship. A perfect choice, except for one thing: There's a chance some of that watch's parts were made—brace yourself—outside Switzerland.

Even though most Swiss watchmakers won't discuss it, plenty in the industry, whose 2010 exports totaled 16.2 billion francs ($18 billion), use components made elsewhere. Since 1971, Swiss law has stipulated that local watchmakers can label their products Swiss-made only if non-Swiss parts equal less than 50 percent of the value of the watch's movement, or motor. That means the movement in a Swiss watch—the essential component—could be 49 percent Other.