BRP vice president explains sport boat exit
BRP’s exit from the sport boat market was an effort to strengthen its product portfolio by allocating resources to industries exhibiting a faster growth rate, according to Yves Leduc, BRP vice president and general manager of its North American Sales and Marketing division, who spoke to Boating Industry in an exclusive interview.
BRP first entered boat manufacturing in 1994, but today the segment only represents 3.5 percent of BRP’s overall business. Leduc said the necessary investment to ensure growth in the sport boat market would be too substantial going forward.
“We realized that even doubling our market share in an industry that wouldn’t rebound in the short term would have required a large investment in product development and engineering,” Leduc said.
Instead, Leduc said those development efforts can now be shifted to BRP’s other industries, like its recent innovations in its roadster and side-by-side utility vehicles, as well as its personal watercraft models.
Leduc described personal watercraft as one of BRP’s most interesting growth industries and said the PWC division stands to benefit the most from the decision.
“We see mid- to long-term growth in that industry, which we tend to drive almost all by ourselves,” Leduc said. “ But to get there, we needed more concentration, more focus. And that is how the boat decision appeared.”
BRP is in the process of shifting PWC manufacturing from Valcourt, Quebec, to a new plant in Juarez, Mexico. The process, which will take two to three years, will lower base production costs, according to Leduc.
Leduc said BRP wanted to wait until the end of the season to make the decision to cease sport boat manufacturing. The decision also followed a year where the boating industry stabilized, but failed to advance past single-digit growth.
“It would have taken a very long time to come close to where we were in 2007, so now is as good as a year later,” Leduc said.
BRP announced it would be closing its manufacturing plant in Benton, Ill. The general shutdown was effective immediately while most workers were still on annual summer production break, according to this Montreal Gazette report.