The decision by Bombardier Recreational Products to exit the sportboat business and shut down its Illinois plant, eliminating 350 jobs, was the second major decision the company has made as it strategically addresses its marine products.
In May, the company announced that it will transfer the assembly line of its watercraft from Valcourt, Quebec, to a new plant to be built in Mexico.
BRP also will stop producing its own accessories and clothes and contract out the distribution of spare parts, according to The Globe and Mail in Toronto.
The company invented the snowmobile and made a killing with its Sea-Doo watercraft. It started producing sportboats 18 years ago. But sales of the jet-driven boats, often used to water-ski, have not bounced back after the recession as cautious American consumers continue to put off nonessential spending.
BRP tried to sell the plant in Benton, Ill., that it inherited through its 1995 acquisition of Celebrity, but it couldn’t find a buyer.
The sportboat business represents 3 percent of the company’s sales, BRP public affairs vice president Pierre Pichette told the paper.
The company stopped disclosing its revenue after the Bombardier unit was bought out in 2003 by a consortium led by U.S. private equity fund Bain Capital. Bain partnered with the family of Laurent Beaudoin, who transformed Bombardier into a transportation multinational, and the Caisse de dépôt et placement du Québec, Quebec’s biggest pension fund manager.
In a 2011 interview with the paper, BRP president and CEO Jose Boisjoli was hopeful that annual sales would recover all of the ground lost during the recession by 2013 and reach the $2.8 billion mark again. BRP’s revenue crashed 40 percent within six months of the Lehman Brothers collapse.
The difficult days clearly are not behind BRP, whose plans to return to the stock market after a five-year restructuring have been delayed. It is now pinning its future on the design of high-end power-sports vehicles such as the Spyder, a three-wheeled roadster it launched in 2007.
After the layoffs are taken into account, BRP employs 6,500 people, 3,000 based in Quebec, according to Pichette.