Bayliner to focus cruiser sales, production in South America

Posted on Written by Michael LaBella

Brunswick Boat Group announced Tuesday that it will stop building and selling Bayliner cruisers in the United States so the brand can focus on its core bowrider and deckboat models, as well as new categories, such as the jetboat segment.

As a result, Brunswick said it will stop production at its plant near Knoxville, Tenn., where 225 full-time workers are employed, by the end of 2012 and make its Brazil operations the center for its Bayliner cruiser business. It will suspend the brand’s cruiser sales and production outside of South America.

Bayliner produces a line of six cruiser models from 24 to 33 feet.

“We will continue to maintain our leadership position in the North American cruiser segment with our Sea Ray brand,” Andrew E. Graves, president of Brunswick Boat Group, said in a statement.

Over the next several months, Bayliner will introduce a new line of bowriders, a new series of deckboats and will launch “Element,” the company’s break into “affordable boating,” Graves said.

Bayliner will also enter the jetboat segment in 2013 with a new series.

“We believe this effort will solidify our position in the market and offer dealers and boaters a wide variety of choices and models,” Graves said.

The world’s largest boatbuilder cited changing global trends and fluctuating needs of boat buyers for the move.

“Our current plan reflects a change in focus for Bayliner’s global product portfolio to emphasize and expand its leadership across a broader set of recreational dayboat craft types,” Graves explained.

“Additionally, Bayliner will make its Brazil operations the center for its cruiser business but will suspend the brand’s cruiser sales and production outside of South America,” he said.

“This strategic repositioning of Bayliner further reduces the need to maintain the Brunswick Boat Group’s current cruiser production capacity in the U.S., particularly in view of current market weakness for cruisers. As a result, we will consolidate our U.S. cruiser production for Sea Ray into our Palm Coast, Fla., and Vonore, Tenn., facilities while producing Bayliner cruisers in Brazil. This will be more efficient and still allow us to retain capacity equal to three times our current worldwide cruiser demand, enabling us to adequately increase production when the market improves,” Graves said.

The company estimates that these actions will save $10 million to $12 million a year once implemented.

“The complexion of the global marine marketplace continues to evolve and so does Brunswick,” said chairman and CEO Dustan E. McCoy in a statement. “Our continuing challenge is to adapt our brands, models and technologies to best appeal to today’s boating consumers, as well as the shifting global marine marketplace.

“Though the U.S. marine marketplace has improved recently, the recovery has been uneven across the various market segments,” he added. “While sales of smaller boats, such as popular fishing boats and pontoons, have improved, demand for cruisers and larger boats remains weak. We believe this is due to a number of factors, including continuing economic uncertainty, as well as a cautious and evolving consumer. The actions announced today are a necessary step in enabling us to reach our near-term operational and financial objectives while positioning the company to exploit future market growth in the fiberglass boat segment.”

Separately, Brunswick also concluded that a portion of its long-lived assets pertaining to certain boat brands, including Hatteras, Cabo and its European and Asia-Pacific boat brands, have been impaired and that impairment charges related to these brands will be recognized in the third quarter.

Brunswick’s estimate of total restructuring and impairment charges in the third quarter will be in the range of $25 million to $32 million, pretax. These charges primarily include non-cash asset write-downs but also include charges for severance, facility closing and other costs. Further, the company anticipates that additional charges pertaining to these actions will be recognized in future periods.

— Reagan Haynes


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Comments

16 comments on “Bayliner to focus cruiser sales, production in South America

  1. Bob M

    So much for creating jobs in US. With so many American boatbuilders out of work. This should not happen with unemployment where it is. Is Brunswick a real American company or not?

  2. Capt. Chris

    This will be more efficient and still allow us to retain capacity equal to three times our current worldwide cruiser demand, enabling us to adequately increase production when the market improves,” Graves said.

    Does Brunswick really need production capacity @ 3 times the current worldwide cruiser demand? Do they realistically expect demand to increase 300%? Sounds like bad planning to me. In a bad economy they are sacrificing their entry level cruiser line in North America? Guess they are counting on the upper end consumer at the expense of the lower end of the market. Only time will tell if they’re right.

  3. freedomsailor

    My wife and I were about to buy a Cruiser. When I read this story this AM and told my wife about it, we both agreed to shop around for an American made boat.

    We make our money in the USA and we will keep it here!

  4. C. Moore

    To sell in Brazil you have to build it in Brazil.
    They protect their jobs and grow jobs by making it impossible to import items they want to build.
    You have to pay to play in the BRIC countries.
    The Italian boat builders moved there years ago.
    More Americans manufacturers are on the way.
    Look for SAFTA (Stupid Americans Forfitting The American-dream)
    to be on the horizon sold as a good deal for the USA- NOT!!!

  5. Mark P

    Freedom Sailor, Make sure you look at Chaparral. As a dealer for Chaparral for 28 years, I have never been disapointed in their dedication to building high quality boats at a reasonable price, in other words, maximum value! In AMERICA!!!

  6. Bayboater

    “Bayliner will introduce a new line of bowriders, a new series of deckboats and will launch “Element,” the company’s break into “affordable boating,” Graves said.”

    Wasn’t Bayliner built on the premise of “affordable boating”??? They have been an entry level boat brand since they introduced the Capri line back in the early 80′s.

    As far as their cruiser line goes, they didn’t have much of one lately anyway, so no great loss… Except for the many U.S. jobs!!!

    Do they still build the 175 in Mexico?

    Bayliner- A “global” company… :(

  7. martyf32

    Finally they are going to get their Crap Bayliner boats out of this country.Brunswick has destroyed the quality of every major boat company that the have bought. Their company is run by a bunch of number crunching hacks that know Most of which have most likely never been on a boat, leave alone owned one. Go back to building engines and drives and leave the boat building to companies that know what they are doing.

  8. Dennis

    I believe the point they are trying to make is the fact that there are not enough cruiser sales in the United States to keep the line going. The Brazil factory is completely new from the ground up and is solely designed to produce boats in emerging markets such as South America, Asia, Africa, etc.. The Brazil facility was never intended to replace the US factory, it has been on the drawing boards and producing boats for awhile now. Brunswick is simply stating that the only cruisers to be produced will be produced down, just in case someone sees a new 2013 Bayliner Cruiser while on vacation overseas. The closing of the TN plant is the story here. The cruiser market is less than soft, especially with the enormous amount of cruisers built between 2000-2007 which are now being offered for sale/brokerage. Too many were sold during that period thanks to easy to obtain financing and now those owners are dumping them. I predict Bayliner will be re-introducing cruisers back in the US as soon as those recently purchased cruisers are “flushed” through the system.

  9. Capt. Rich

    Ok Brunswick, we understand. Just don’t try to bring them back when the economy starts to move again. It’s way past time to build American and buy American.

  10. Virgil

    I’m old enough to remember when Edson first came out with the Capri line………..known as “bay-pigs” to the competing dealers and truly the first ‘disposable boats’ good for maybe 3 seasons. I swore that I’d never set foot on another Bayliner and I’ve kept my word for 30 years.

  11. RdFalcon

    I find it amusing that people still bash the quality of Bayliners. These would be the same people that would pony up double the cash for a Sea Ray, built with the same fiberglass, gelcoat and in many cases built in the same plants.

    I giggle even more at the people that sell other brands and bash the line as well. Bayliner put more first time boaters on the water than any other boat company in history. So as you sit back and attempt to sell your “high end” boats, wondering …. “Where are all the buyers looking to trade up into these expensive boats” you can look back at Bayliner and say “Thank you”. If it wasn’t for them putting hundreds of thousands of first time boat buyers on the water since the 80′s, you wouldn’t have a job today.

    And if Bayliner goes away completely someday and no body starts chasing that first time “cheap” buyer again, this industry in the US is DOOMED!

  12. CBS

    Unfortunately Brunswick is moving out of the county because costs are too high. Another company using costs of doing business for going to where labor has no safety requirements and you can pay someone $5 a day for labor. Shame on them, maybe they could get rid of their enormous middle management they have and they could save American jobs. Boycott there brand until they return to the US. Their excuse is pathetic. If you believe this is the best, you probably think that the tooth fairy is real.

  13. Kinu Lee

    Brunswick goes to Brazil !!!
    Hope they will not close Brazil plant in less than 3 threes like their plant in China.
    In Europe, Brunswick moved from France to Belgium, than to Poland.
    Now they moved to Portugal.

  14. Ted O.

    I bought my first boat, a Bayliner Capri cuddy back in 1983 and had it 21 years. It gave good service all those years and still looked new when I sold her for 1/3 of the original price. I now own a 2003 Bayliner 265 cruiser which again is a great boat. Of course Bayliner always played the confusing number game changing the name of the model to a 275 in 2005.

    The harbor here is full of small Bayliner cruisers, my guess is 5% of 2409 boats in slips, and these people made a conscious decision to buy them. If they had wanted or could afford a Sea Ray they would have bought one. So to now to compete they, Brunswick, will have to cheapen the Sea Ray and destroy that brand. They would have been smarter to continue to build Bayliner cruisers and just not produce small Sea Ray cruisers and used the Sea Ray brand as a stepup brand.

    Oh well, another bad “Bean Bounter” decision.

  15. River Rat

    Funny how in this country when something becomes rare and hard to find how valuble they become. advise..Take good care of your bayliner…

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