Fairline at London Boat Show

Fairline CEO remains optimistic despite cutbacks

By IBI Magazine

Speaking candidly to journalists this morning on the opening day of the London International Boat Show, Fairline's Derek Carter gave a relatively optimistic forecast for the UK boatbuilder's year ahead despite announcing cutbacks to its workforce and capacity at the end of last year.

"The end of 2008 was challenging to say the least," Carter told journalists at the breakfast event to mark the world launch of its Fairline Squadron 70. "The first half of the year had gone very well with sales and profits up, and we went to Southampton (in September) feeling quite optimistic. We saw sales of 30 boats there and most of them stuck. Once Lehman Brothers went and the banking system faltered, that affected our dealers and in turn us." In September, Fairline announced 90 redundancies at its Oundle and Weldon facilities in Northamptonshire and subsequently put workers on a shorter working week with reduced wages.

A second wave of job cuts was announced in December, when the company revealed that it would cut 275 jobs in Oundle and Corby in March 2009, affecting around one-quarter of its remaining workforce. "As a business we're 35 per cent smaller in terms of capacity than we were last year," said Carter.

"That's in line with how much we envisaged the market would decline." So far Carter claims that those predictions have born out and its business is down by that percentage compared to the peak of 2008.

"That means we're operating at full capacity and we're not seeing any more deterioration at the moment.

" To emphasize the point that business was still holding up, he added that Fairline had sold 86 boats via its dealers around the world in the last four months alone."We should end up with sales of around £100m for 2009," he added. That compares to sales of around £140m in 2008. The first half of 2009 would be slower, Carter noted, as the builder looked to work with dealers to 'de-stock', but would pick up in the third and fourth quarters. "By then we will see some stability returning to the market and with it some confidence.

"Significantly Carter highlighted the fact that Fairline would be continuing its robust development programme, with six new launches planned over the following two years. The Southampton boat show in September last year saw the launch of the Squadron 55, and this year will see the arrival of a new Squadron 65 in May, a Targa 58 in November, as well as a smaller and as yet unnamed boat, along with the flagship Squadron 85 due for launch in mid-2010."We've taken our medicine these last four months and now we are fit for 2009," Carter concluded.

(9 January 2009)