Chanel bags are sewn by hand, but the leather is cut by machine for uniformity. Sewn by hand doesn't mean one bag is manufactured by one artisan from start to finish, as you would see at an artisan's table who makes Birkins. With Chanel, you would probably see some artisans sewing, another group placing hardware or shoulder straps. It's just different.
But this article from PurseForum shows them using sewing machine?
http://www.purseblog.com/chanel/how-a-chanel-bag-is-made/