Update on the status of Triumph Boats - February 2010

[RoryWainer]

There have been several threads over the past year about the status of Triumph Boats in light of their parent company's (Genmar Holdings Inc.) Chapter 11 bankruptcy filing in 2009. I have been waiting for an official response from Triumph Boats before posting much on this myself. I was given the okay from Triumph Boats to relay this recent note from Irwin Jacobs to the Triumph Dealer network, after purchasing Triumph Boats from Platinum Equity as a result of the Chapter 11 process. I believe the letter below is very encouraging news and it looks very good that Triumph Boats will indeed begin production again in the near future and existing customers will be supported thru the Triumph Dealer network. I will post further news as I receive it.

Yes, not good news for the NC economy but may be good for the US boat industry. What Jacobs suggests makes sense if these boat brands are to survive into the future in the USA. The process of making the boats will have common steps across all brands, use common 3rd party components and the non-boat parts of business (accounting, HR, marketing, etc, etc) will be exactly the same. Consolidating factories will allow a smaller shared workforce, higher order quantities, and lower transport and rent costs. These long term savings will be much greater than the one-off cost of moving a factory.

Whenever I see a video on boat making I’m always amazed by how much manual labour is involved in the process – particularly the hulls. Roto-molding could be a major advantage in this area. US (and Australian) labour costs are very high compared to many other countries, and already some boat companies are starting to build their products in Asia to reduce labour costs. Consumers start off saying “I’d never buy a boat made in Asia” but that doesn’t last; they go where the price is lower and the quality acceptable...just think about where your outboard motor comes from.

Compared to other ways of building boats, the processes used to build a Triumph is really efficient, and if they can build enough Triumphs or adapt some of these processes to the other brands they may make enough money to keep building boats in the US. I suspect Jacobs is trying to solve the labour cost issue, not by going offshore for cheap labour, but by reducing the labour component in building his boats. This is smart business and good for the USA.

If this turns out to be the case, Jacobs, et al should be supported to do whatever is required to make money out of this venture or next we’ll be reading that Triumph, Ranger, et al is owned by (say) Suzuki and the factory is moving to Indonesia.

Apologies for the long winded economics lecture, and probably stating the obvious.

[boostjunkie1]

YES, I agree with what you have stated. I also agree that my Yamaha motor was not made in the USA. No other Motor is acceptable for the money and the Japanese do it right. No cheap parts or worthless labor. My boat ( USA MADE ) was though and a huge factor in me buying a Triumph was because of their location... NC, my Home State! If the plant moves to another US location that is OK in the long run. Boost

[RoryWainer]

YES, I agree with what you have stated. I also agree that my Yamaha motor was not made in the USA. No other Motor is acceptable for the money and the Japanese do it right. No cheap parts or worthless labor. My boat ( USA MADE ) was though and a huge factor in me buying a Triumph was because of their location... NC, my Home State! If the plant moves to another US location that is OK in the long run. Boost

Actually when you think about the long term transport costs, particularly for international sales, moving the other factories to North Carolina could make the most sense.

[rscott]

Wow, a manufacturer moving NORTH! I don't think I've ever heard of THAT before. Maybe instead of being refered to as the rust belt we'll become known as the PolyPro belt.

[unkl jessie]

And the weather is normally better!??

[HighTechRedneck]

I don't know how many boats they ship to other companys but I bet it is not many. I would think that a factory in the center of the country would reduce their shipping costs. The other thing is how big are the other plants he now owns. There maybe one that they can produce all the brands under one roof. It is much easier to keep control over your staff and quality control when you only have one plant to deal with. It should also lower administration costs.

Just my random $0.02

HTR

[mkstocks]

There is a political benefit to remaining in NC. If all your hulls are under one roof, then you have 2 senators on the hill. If you have manufacturing spread out over 4 states, then you have 8 senators with your interests in mind. Spreading manufacturing across 4 states instead of just 1 also means that 4 governors have incentives to keep your jobs for their constituents instead of just 1 governor. Ask for tax incentives for staying in each place.

And while you are on a roll, how about a cuddy for the 17' fleet? My tent arrangement works, but something better has to exist.

See you on the water.

[BarryB]

Yes a cuddy would be great, but, not going to happen.

[HighTechRedneck]

What would also be cool is a 23 foot DC

HTR

[Dwayne Prickett]

An internet search showed that Platinum Equity LLC bought Genmars assets and is moving some Genmar operations to consolidate with brands they already own. Some remaining brands including Triumph were sold off as well, see below:

FOR IMMEDIATE RELEASE:
January 21, 2010
Minneapolis, Minnesota
Irwin L. Jacobs, Chairman of J & D Acquisitions, LLC, (“J&D”) announced today that J&D has agreed to purchase several Genmar businesses and assets from Project Boat Holdings, LLC, an affiliate of Platinum Equity. The transaction is expected to be effective immediately after Project Boat’s acquisition of such businesses and assets from Genmar.
The assets being purchased by J&D from Project Boat include the Larson, Seaswirl and FinCraft boat brands, along with the Little Falls, Minnesota, Larson Boat factory and its molds, equipment, property, plant and inventories associated with all three brands. Additional purchases include the VEC Technology, Inc. (“VEC”) company located in Greenville, Pennsylvania, and all of its property, plant, equipment, inventory and all of VEC’s patents and copyrights registered throughout the world. Also included in the purchase by J&D is the Triumph Boat Company, its brand, factory, equipment, patents and copyrights, molds and inventory located in Durham, North Carolina.

At least the assets were purchased by boat savvy investors not conglomerates in the asset liquidation biz!

Dwayne