Ballon Bleu watches first reached the market in 2007 and are characterized by round cases and a crown set with a sapphire. Prices of standard models start at less than 10,000 euros, while diamond-encrusted or complicated versions can retail for hundreds of thousands of euros.

Cartier dates to 1847, when Louis-Francois Cartier took over the jewelry workshop where he was an apprentice. The company became one of the first to make a wristwatch, with a piece made in 1904 for Brazilian aviator Alberto Santos-Dumont.

Fornas took over as CEO in 2002 after heading Richemont's Baume & Mercier watch brand and following a career that included posts at Procter & Gamble Co. and perfume-maker Guerlain.

Manufacturing Investment

One of his early decisions was to invest in capabilities to manufacture watch movements, which Fornas said allowed Cartier to have greater control over quality and design. About 5 percent of watches sold by Cartier are returned within the warranty period, below the industry average of 10 percent to 15 percent, he said. The brand is aiming to reduce that to about 3 percent over the coming years.

Fornas said he doesn't want Cartier "to be slowed down in Asia because of a lack of movements in the future, so let's prepare the ground and invest on a regular basis." The watchmaker unveiled its first movement designed in-house in 2009, according to Weber.

Cartier has production facilities in Geneva and La Chaux- de-Fonds, the heart of Switzerland's watchmaking industry, and is planning to construct a new plant in Neuchatel.

The shift toward mechanical watches is in line with changing consumer tastes as the use of quartz-powered movements in luxury timepieces wanes, he said.

Customer Demands

"People are more demanding on quality, performance and design, and we have moved quicker than the market," Fornas said.

While it's difficult to predict how the industry will fare in 2012, Cartier will benefit whatever happens, Fornas said. "If things go bad, people go to the legitimate brands, to the authentic brands and not to fashion fads," he said.

Cartier is the "clear leader" in jewelry and No. 2 in exclusive watchmaking after Switzerland's Rolex, according to Fornas.