Art Basel’s Parent Company MCH Group Has Laid Off 150 Staffers as the Pandemic Sends Shockwaves Through the Event Industry

Even before the full force of the coronavirus pandemic hit the
art world, Art Basel’s parent company, MCH Group, was grappling
with instability and shareholder unrest. Financial strain and
difficulties allocating its resources between its trade fairs and
its live marketing division had been plaguing the Swiss company—and
now the global health crisis has sent shockwaves throughout its
numerous enterprises.

Five high-profile brands including Rolex, Patek Philippe,
Chanel, Chopard, and Tudor have deserted Baselworld, MCH Group’s
premier watch fair. The luxury watchmakers jointly announced plans
to exit Baselworld in 2021. The news came after Rolex released open
letters complaining about the fair’s 2020 rescheduling plans and
its handling of refunds.

The brands have now joined forces with the Fondation de la
Haute Horlogerie in Geneva and yesterday announced plans to create
a new watch show in early April 2021 at the convention center
Palexpo, coinciding with Watches & Wonders. “This departure follows
a number of unilateral decisions made without consultation by
Baselworld management, including the postponement of the watch show
until January 2021, as well as its inability to meet the brands’
needs and expectations,” according to the watch brands’
joint statement.

The split appears to be increasingly acrimonious. “It is with great surprise and equally great regret that the
MCH Group takes note of the cancellation of major exhibitors at
Baselworld,” reads a statement from MCH Group. “The new date for
the unavoidable postponement of Baselworld 2020 was defined jointly
with leading exhibitors. The objective was to find the earliest and
best possible date for the industry following the Covid-19 related
measures. The companies now ‘migrating’—including Rolex—spoke out
in favor of a postponement to January 2021.”

MCH had already been forced to cancel the fast-growing Hong Kong
edition Art Basel last month and has now pushed back the Swiss
edition of the art fair from June to September.

News also emerged recently that MCH laid off 150 employees in
its live marketing entity, known as MC2. “We had to lay off 150
employees at MC2 Group [in its “live marketing solutions”
division] in the USA, because in the USA—unlike in Europe—there are
no measures such as short-time work to avoid redundancies,”
a representative told Artnet News.

The cut to the live marketing division represents 42 percent of
its 350-person workforce. In total, about 800 employees worked for
MCH Group before the lay offs.

The cut represents a stark reversal in MCH’s business
trajectory. Less than three years ago, when MCH acquired MC2, the
move was described as
“by far the biggest acquisition in the 100-year history of MCH
Group and” and “a tremendous step forward in the implementation of
our corporate strategy.”

At the time, MCH said MC2 had 15 locations in the US and one in
Dusseldorf, Germany, and an annual turnover of roughly CHF160
million ($160.6 million).

Many observers have debated the value of MCH’s live marketing
business versus its art fairs. MCH shareholder Erhard Lee argued
unsuccessfully last fall that the company should focus more on the
former and decrease its focus on the fairs. (Lee did not
immediately respond to a request for comment.)

The MCH representative insisted that the changes at Baselworld
and MC2 “do not have any impact regarding Art Basel.”

The post Art Basel’s Parent Company MCH Group Has Laid Off
150 Staffers as the Pandemic Sends Shockwaves Through the Event
Industry appeared first on artnet News.