Wondered how long it was going to take - bad news

[Jim Seamans]

Brunswick to Shut Boat Plants, May Cut 10% of Jobs (Update3)By Andrea Snyder and Meg TirrellJune 26 (Bloomberg) -- Brunswick Corp., the maker of Sea Ray yachts and Boston Whaler fishing boats, plans to close four more North American plants and may fire as much as 10 percent of its workforce to slash costs after U.S. powerboat sales fell to the lowest in more than 40 years.Brunswick aims to reduce fixed costs by $300 million from 2007, according to a statement today. The Lake Forest, Illinois- based company had previously said it would close eight factories, reducing the number still in operation to 17 by the end of 2009, compared with 29 in 2007.Consumers' ``ability and desire'' to buy boats as well as Brunswick billiard tables and fitness equipment has been reduced by a shrinking U.S. job market, surging fuel prices and declining home values, Chief Executive Officer Dustan McCoy said in the statement. The cost of oil has more than doubled over the past year as the dollar dropped against the euro, driving the price of U.S. unleaded gasoline to $4.07 a gallon as of June 25, up 34 percent for the year.``We are not assuming that these pressures will abate any time soon,'' McCoy said in the statement. ``We are planning for an environment in which the U.S. marine market will be smaller in the near term.''

 

[Scott]

Not surprising ...

After years of astonishing sales levels, it was bound to happen. As an anecdote ... last Sunday we were out sailing on a day with a relatively minor threat of thunderstorms. I was amazed by how quiet the lake was. Our marina, which normally has an overflowing parking lot for trucks and trailers (with boats on the water) on any normal weekend day, was absolutely empty and the guys that man the ramp fee station were commenting that it was like a very slow weekday, not anywhere close to the business they have on a weekend, where there are normally lines of trailers all day long to use the 3 ramps.Normally, on a day when thunderstorms are possible, people are still out, just ready to buzz back in if the weather acts up. Not now, it seems like people are just going to stay home even on the chance of rain. BTW, it didn't even rain once all day long and at dinner time, when people are normally streaming home, there was hardly even a boat on the water (only a few sailboats ).

 

[John Nantz]

Closing Sea Ray plants - Bad News???

Except for the people that will lose their jobs it sounds more like GOOD news!I'll toast to that!(Especially if some of the plants are in the Northwest!)

 

[Mike B]

It's bad news for sure

While there are obviously fewer power boats out on the water it's still bad news. There's going to be a major economic ripple effect from all of this. Do you think your favorite restaurant or chandlery are going to be able to remain open with just sailboaters patronizing them? Fewer boats in marinas mean they either have to raise rates or cut services for those remaining. The marine industry is heading for some very lean days. Make no mistake, it's going to have an impact on all of us.

 

[sailortonyb Allied Mis]

It's a pretty bleak picture

and I think the American way of life as we know it has just come to an end. I think we will be lucky if the whole world doesn't go into a depression.You cant hardly give away an SUV and have a hard time getting rid of even the smaller pick-up trucks. I dont think the American mind set has actually assimilated all of this yet. But it will, and soon enough. Boating is one of our biggest escapes from reality and that too for many may come to an end. Even sailors with little to no fuel requirements, will still have to spend a lot of money getting to and from their boats. Throw into the equation the fact that available spare money has dried up and it dont look good. If we didn't live aboard, we couldn't afford our boat and I make a fairly good salary, or used to. Work has been hard to come by this year and I work offshore on the rigs and platforms. Go figure.Tony B

 

[Banooma]

economic correction

An interesting story, it IS bad news, and definitely a sign of the economic and oil crunch. We have to recognize, though, that the economy cycles like the tide, and I'm guessing an industry like motorboating operates on some rather small margins. They're just covering themselves for the reality of their short-term finances. Just because house sales are down doesn't mean there are fewer people living in houses. I think there's just a lower demand to buy new boats (or any expensive luxury item) right now because credit is tighter and most likely the market is smaller for new entrants. Things are tighter, but we still have our boats and our lifestyle. I know that when I'm sailing this weekend, I will be enjoying every minute. Life could be much worse (as I say this I'm also purposely NOT looking at what the schizophrenic stock market did today).

 

[Capt. Kermie]

So who's buying the toys?

I live pretty near right on the 49th and most of my sailing is there too. The Point Roberts marina (PNW)is now full, a first in many years. I now have to buy annually to keep my slip whereas previously I could buy seasonal. I have heard that baby boomers control the nations wealth and also hear they are retiring in droves and buying toys, RV's, motorcycles, motorhomes, boats, all manner of toys. Yet I hear a lot of talk about recession, funny I don't see the evidence just hear about it in the news. I am not rich, just a lowly public servant collecting a measly gov't paycheck, but am not starving. Housing is only going up in price not down, fuel is going up and everything associated with it is also going up but wages are not. Folks may have less discretionary income but they still spend like there is no tomorrow. Ok so this is north of 49 but our economy is heavily dependant on the U.S. economy and profoundly influenced by it, yet the impact is not nearly as severe as the news would indicate. There are wait lists at every marina in the PNW north of 49. Someone owns those boats! I was at the Seattle boat show and saw no shortage of crowds nor shortage of boats and gear, I don't think the recession has hit that area as hard. I will keep my eyes open over the next 5 weeks while on vacation and see if there are fewer power boats out there. Last year there was no shortage of them. Plenty in the marina anyway.

 

[sailortonyb Allied Mis]

Its not about the stock market

its not about housing cost or about tighter credit. This is not a normal economy cycle. This is a first. Not many businesses are forecasting the price of oil to go down much, if at all. If oil is high, it affects most people. Its about available money to spend on leisure items. The price of gas is killing some people, even sailors. Many people live 200 miles or more from their boat and used to look forward to the weekend drive. For some that could mean $60 to$70 or more for just gas to get there and back. Add that to the extra cost of driving to work and back every day, not to mention heating and AC rising costs. This doesn't even count the over all price rise of everything you could possibly think of. Some people have experienced a $100/week or more rise in their every day living costs. For many, that does not leave any money left for boating - sail or otherwise. Apparently some are more fortunate than others, but that does not mean it doesnt affect others just because it doest affect you.Tony B

 

[Alan]

...and more coming

Brunwick Corp. this morning said it plans to reduce its fixed-cost structure by $300 million by further shrinking its North American manufacturing footprint.The company plans to have 17 or fewer plants by the end of 2009, compared with the 29 it had in 2007. This will require the closure of four plants in addition to eight plant closures already completed or announced.The company also notified employees today that it would reduce its hourly and salaried workers at some of its marine plants by 1,000. Further work reductions of about 1,000 hourly and 700 salaried employees across the company’s marine business units are under consideration.

 

[Banooma]

wrong again

LOL - I could say the sky is blue and Tony could find fault in my logic! I'm just saying there are things we can control and things we can't. Things today are never the same as they were yesterday. Most things go up in price every year. Yes, the current economic situation is new, and yes it presents new challenges to just about everyone. It is worse this year than it was a year ago, but complaining or panicking isn't going to accomplish anything. We all have different sets of priorities, different expenses, and different obstacles to making our life exactly as we want it. Our sport is a luxury, whether someone sails from their personal dock on their waterfront home or trailers their boat 200 miles. It's about prioritizing and buckling down, I'm not disputing that it can be a pain in the a$$. It definitely means sacrificing. I'm only saying that each of us will do our best to balance, and hopefully we will sail through it. It's a much better problem to worry about how many times you go sailing, or how far you'll cruise, than to worry about whether your family will eat tonight. That's the only perspective I was trying raise.

 

[sailortonyb Allied Mis]

Ban

Ramblings that dont make sense. Were you a philosophy major? You say its prioritizing, well, yes it is and the point is that when all is prioritized, there is no money left for the boat in a lot of cases. Some people have obstacles that cant be over come and cannot make their life exactly as they want it or anywhere even close. "It's a much better problem to worry about how many times you go sailing, or how far you'll cruise, than to worry about whether your family will eat tonight." You gotta explain that one to me.If I look at that statement I think that if a man does not have the extra money to travel and visit his boat, i would consider that more than just a "a pain in the a$$." Thats assuming that he makes the choice of not seeing his boat.You are very fortunate to not have to be in that position. Not everyone has your wealth. Apparently you cannot see that some were living close to the bone prior to the oil price increases and the increase in oil prices threw them over the edge in the economy.People shouldn't panic but they do have a right to complain. This was a post about how bad things are in the economy in MOST of the US. There are of course always some exceptions and your area is one of them. But that still does not erase the fact that things are bad everywhere else.So , do you think Ford and many other manufacturers are shutting down plants are over reacting to this little 'glitch' in the economy? Maybe you should apply for a CEO job there.Tony B

 

[newly anonymous]

alternative view

Although pain in certainly involved for those who lose their jobs, I choose to read this as a positive moment. People are finally coming to a point where they realize that we must make recreational choices that don't involve the burning of fossil fuels. Human nature being what it is, we knew what we needed to do on an intellectual level long before our pocketbooks forced us to pay attention on a practical level. So now we live in an economy where snowmobiling will give way to cross-country skiing, where wave runners will be replaced by board sailors, where water skiing will give way to kayaking, and where Sea Rays will be outsold by Catalinas.This is a good thing. We become a healthier society living in a healthier biosphere. Meanwhile, let's go sailing.

 

[Tim R.]

Tony Chill

I think we all agree it is bad but that is no reason to attack Ban for his opinion. If you could predict what is going to happen with the economy then you have a special gift and should never need to worry about money again.

 

[sailortonyb Allied Mis]

Newly...

I am going to take your advice "meanwhile lets go sailing" as soon as I get home Saturday night.....Well, Sunday for sure if the weather is nice. I will have 2 weeks off so I may take a trip down to Port Aransas, Tx. or I may complete other projects on my boat.Tony B

 

[sailortonyb Allied Mis]

Sorry Tim

I didnt realize that you were in charge. Silly me.

 

[NautiDuck]

It's a correction - albeit a major one

It is a big economy and some will hurt worse than others. We don't have an adjustable mortgage, we don't have credit card bills and we live conservatively. While my 401K is sucking air lately, it a long term investment and I believe it will come back. This is a strong and resilient country. I also agree that the rise in fuel costs has a positive side for the earth in the long run. We cannot keep burning fuel in big cars, trucks and boats. The lone driver in the Suburban is starting to look downright stupid and that is fine with me. And I also agree that just about everyone I know - all middle class - are doing just fine. Of course there are those who are suffering, such as the workers at Ford and Sea Ray, and I feel badly for them.P.S. Sailboat sales are down too. Our part of the world is not exempt.

 

[Banooma]

anger management

I should't laugh, but I'm amused by Tony's rage against my practical attitude towards facing the unknown and and transforming this thought into my "wealth." Tony, I couldn't afford a 39 foot sailboat in my dreams, and you're crying about how people like me aren't affected by the economic downturn? I've been laid off twice in the past 7 years, so please don't talk to me like I'm out of touch with reality. People in NJ are losing jobs, too. Many sailboat slips in my marina are vacant this summer. I'm trying to make a point about all of us sharing the common need to live within our means, and hopefully that means we can all still sail. There's no point in being outraged at stuff we can't control or influence. To me, that's a waste of my energy and focus. In the long run, we'll all be dead, but I'm not going to whine and worry. For now, I'm trying to do my best to enjoy the best parts of living within our means. That's the best any of us can do. What's so high and mighty about that?Since Tony asked, I'll spell it out:"It's a much better problem to worry about how many times you go sailing, or how far you'll cruise, than to worry about whether your family will eat tonight." You gotta explain that one to me.Sailing is a huge part of my lifestyle, and I wouldn't want it any other way. However, I could be sick, boatless, homeless and penniless and be begging on dirty streets for food. That would suck. That would be much worse than worrying if I can take out my boat 2 or 4 times next month. Get it?If this perspective makes me so wealthy, then I'll accept your remarks as praise, even if they don't put money in my pocket. Thanks Tony!

 

[sailortonyb Allied Mis]

Ban

That was yesterday. Today is today.I was just messin with you. I figure you are from Jersey, you could take it.....And dish it out. I go home tomorrow morning so I am in a good mood today. But I'll behave.PeaceTony B

 

[Guest]

Ducky cash is king.

I move 1/2 of my 401 to cash. My loses are not to bad.

 

[Tom S]

Banooma I agree with your perspective

But I gotta say , not sure if you live there or just keep your boat there, but I could think of a lot worst places to live/play than Harvey Cedars NJ. Pretty 'tony' place. Ever time I drive through there I think the local cops want to pull me over and ask where I am going Say hi to Barney for me