LVMH's Strategic Move to Strengthen Its Watch Division via La Joux-Perret Acquisition

LVMH's move to acquire a minority stake in La Joux-Perret is emblematic of its broader vertical integration ambitions. La Joux-Perret, a manufacturer with a 150-year legacy, specializes in producing high-precision watch movements, including the solar quartz technology used in Tag Heuer's Aquaracer and Formula 1 collections, according to a WWD report. By strengthening its commercial partnership with the firm while maintaining its independence, LVMH gains greater control over critical components of its production process. This reduces reliance on external suppliers and ensures a steady supply of cutting-edge movements for its luxury brands, such as Hublot, TAG Heuer, and Zenith, as noted in a Marketscreener article.

The acquisition also aligns with LVMH's historical pattern of consolidating upstream and downstream operations. For instance, its ownership of watchcase manufacturers and dial producers has already given it a degree of self-sufficiency. Adding La Joux-Perret to this ecosystem allows LVMH to streamline innovation cycles, accelerate time-to-market for new products, and maintain tighter quality control-a critical advantage in an industry where craftsmanship and exclusivity are paramount.

Strategic Advantages: Innovation and Differentiation

The partnership with La Joux-Perret is not merely about supply chain security; it is a platform for technological differentiation. La Joux-Perret's expertise in solar-powered movements, for example, has already enabled LVMH brands to pioneer sustainable luxury. The solar quartz movement, which combines energy efficiency with precision, has become a signature feature of Tag Heuer's collections and even powered Tiffany & Co.'s Rope watch. Such innovations position LVMH to lead in a market increasingly driven by eco-conscious consumers.

Jean-Christophe Babin, CEO of LVMH's Watches Division, has emphasized the goal of becoming a leader in sustainable, high-precision watch movements. This aligns with broader industry trends, as competitors like Rolex and Patek Philippe face pressure to modernize while preserving heritage. By leveraging La Joux-Perret's technical capabilities, LVMH can differentiate its offerings through both tradition and innovation-a dual strength that few rivals possess.

Long-Term Market Dominance: A Calculated Path

LVMH's Watches & Jewelry division reported 1% year-over-year organic revenue growth to 7.54 billion euros in the first nine months of 2025. While this growth rate appears modest, it reflects the division's resilience in a market where demand for ultra-luxury timepieces remains robust. The acquisition of La Joux-Perret is expected to amplify this momentum by reducing production bottlenecks and enabling faster scaling of high-margin products.

Industry analysts argue that LVMH's strategy is designed to outmaneuver competitors like Richemont and Rolex, which rely heavily on in-house manufacturing. By deepening ties with industrial partners like La Joux-Perret, LVMH can diversify its production capacity without sacrificing quality, as noted in the Marketscreener article.

Moreover, the Swiss watchmaking region-where LVMH now collaborates with 17 manufacturers-remains a cornerstone of global luxury. By anchoring itself in this ecosystem, LVMH ensures access to the talent, materials, and cultural capital that define the industry. This strategic geographic focus complements its global retail network, creating a virtuous cycle of innovation and brand loyalty.

Conclusion: A Blueprint for Sustained Leadership

LVMH's acquisition of La Joux-Perret is more than a transaction; it is a calculated investment in the future of luxury watchmaking. By integrating a partner with unparalleled technical expertise, the conglomerate is fortifying its supply chain, accelerating innovation, and reinforcing its position as a market leader. As the high-end watch sector evolves-driven by sustainability, digitalization, and shifting consumer preferences-LVMH's vertically integrated model offers a blueprint for sustained dominance.

For investors, this move underscores LVMH's commitment to long-term value creation. With its Watches & Jewelry division already contributing nearly 8% of the conglomerate's total revenue in 2025, further growth in this segment could significantly bolster LVMH's profitability and stock performance. In an industry where legacy and agility must coexist, LVMH has once again proven its ability to balance both.