350 jobs to go at Princess - large scale restructuring.

longjohnsilver

longjohnsilver

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Report on local news. £11m losses in 2014 hard to recover from. Managers say order book is strong. 17.5% of workforce affected, not just short contract workers.
No great surprise after what happened to Fairline, but sad for those losing their jobs.
 
It was the headline report on South Today.
350 jobs to go.
Hopefully this trimming will make the company stronger.
When we bought our Princess, we were told that they were the second largest employer in Plymouth.
 
Very sad, but as I've said before significant restructuring is needed at Princess. Fairline's woes have of course diverted attention from them, but that's neither here nor there. All imho of course but a company with as much bank debt as Princess are carrying and a relatively shallow-pocketed owner cannot for such a long period burn £1m/month cash. That it has been allowed to continue till now is remarkable. The warning signs of cash burn and convenient changes to accounting policies to report profits that are not real cash have been there (and reported on here) for a year or two.

Any industrial textbook would tell you at this juncture they need a whole new mindset when deciding whether to take on the ventures like the 30-40m ish stuff (and if yes, how to execute), plus a restructure of the mainstream manufacturing and new management.
 
An other sign ........
Princess.Fr is base at La Napoule -biggest plush office /pitch .
They seemingly have 1/2 dozen berths a stones throw away , Allways full of new stuff with sold signs on or awaiting PDI
Or demo .Stock moving weekly ------ untill last year 2015 .
From around Easter on wards empty --- no stock .
We first thought -perhaps all out at a show or something ,but Frances arguably largest dealer has had virtually zilch stock most of last year .
It could be cos Factory want him to buy not lend on credit until sold ?
Don,t know .
Meanwhile allmost next door 10 yards away @ Subseeker.fr they still have stock and demo,s ready to go .eg brand spanking Pred 57 ,s etc sat waiting for a punter with " £/€ enquire " in the widow .

Like JFM re burning £1M / month ,I,ve said this before a few times dealer has no stock this year in France .
 
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On the way home today i heard on the radio that sunseeker are advertising for staff i.e joiners so looks one of the big company's is doing well
 
Vitesse said:
Princess have always been prone to hire and fire. Is there anything different about this time?
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You gotta hope so. Because "nothing different" would mean taking a binsack containing £1m out to the backyard each month end and setting fire to it. You can do that for a while but ultimately you have to ban the management from having matches.
 
Meantime the new Pearl 95 is in production. Totally different business model, with few direct employees, and most done under contract, no investment in facilities etc. Can this business model work? Can Pearl maintain their brand values and USP this way? Why not?
 
Vitesse said:
Princess have always been prone to hire and fire. Is there anything different about this time?
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Almost word for word what I was going to say.

I do worry it may be a little different this time though. Retreating up market too often seems to herald real problems in UK manufacturing.
 
rafiki_ said:
Meantime the new Pearl 95 is in production. Totally different business model, with few direct employees, and most done under contract, no investment in facilities etc. Can this business model work? Can Pearl maintain their brand values and USP this way? Why not?
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I do happen to know that Pearl was a loss making venture for many years supported by a wealthy owner. I don't know how they're doing now but I suspect they aren't exactly coining it

No surprises with the 350 redundancies at Princess given their results. Its part of a painful restructuring process that many companies have undergone to adjust to a new market reality following the credit crunch
 
benjenbav said:
Seriously, where's another Dalian Wanda when you need one?
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Seriously? I struggle with this logic - which btw is pretty popular in most business, but let's stick to boats:
When a builder is doing poorly and burning money, we always hear people wishing that someone with deeper pockets takes over - regardless of whether the new owner has a clue about the business or not.
In my books, the only folks who are sure to gain from this sort of transactions are lawyers, M&A consultants, banks, etc.
But the company itself, and all its stakeholders, for which reason exactly should they NEED some Chinese billionaire to get in better shape?
Mind, I'm not denying that S/skr seems to be doing better than Princess. And I know the old saying about spending money to make money.
Otoh, we'll never know if S/skr couldn't be doing even better by now, if they would have been taken over by a proper boatbuilder instead - with deep enough pockets of course, but hopefully bringing also some good ideas and a genuine commitment to the table, for a change.
 
rafiki_ said:
Can this business model work?
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It's how it has been done for years in Italy and other places. Loads of established brands in Italy are the sum total of a few dozen contractor projects, rather than the work of a load of full time employees. OK if managed well but you have to work hard to get the quality/passion out of/into the folks nailing/wiring the boat together, who might have low ball quoted to get the job...
 
rafiki_ said:
Meantime the new Pearl 95 is in production.
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Is it actually in production Raf? Not just Dassault renderware? They're bought and paid for the tooling (surely couple £ million) and someone is actually making it? Looks a very good design and I wish them well
 
jfm said:
Is it actually in production Raf? Not just Dassault renderware? They're bought and paid for the tooling (surely couple £ million) and someone is actually making it? Looks a very good design and I wish them well
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Perhaps production is the wrong word, and "in build" probably a better description?
 
MapisM said:
Seriously? I struggle with this logic - which btw is pretty popular in most business,
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Its about breathing space. As I said before a lot of industries including the boat building industry are having to adjust to a new reality of a smaller market and reduced margins and no company can make that painful adjustment in a short time. During this period the company will be burning money but it will burn money a lot faster if it is having to borrow money at commercial rates to finance itself compared to receiving capital injections from a rich owner

In the end of course every company needs to make profit but having a Chinese billionaire owner gives the company a greater chance of getting to that point rather than having the plug pulled on it. As for being taken over by a 'proper' boatbuilder with ideas and commitment, I guess some 'proper' boatbuilders looked at both Sunseeker and Fairline and decided either that these companies weren't worth saving or they needed too much cash to get to that profitable point. Obviously of course 'proper' boatbuilders are sometimes happy to see their competitors go out of business. So in the absence of a 'proper' boatbuilder, a Chinese billionaire is the next best thing I guess
 
jfm said:
It's how it has been done for years in Italy and other places. Loads of established brands in Italy are the sum total of a few dozen contractor projects, rather than the work of a load of full time employees. OK if managed well but you have to work hard to get the quality/passion out of/into the folks nailing/wiring the boat together, who might have low ball quoted to get the job...
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Yep, that's the basis of the "districts" model of industrial organization, and it applies also to several other sectors btw, not just boatbuilding
Actually, I don't think it's likely to produce a lower quality, AOTBE.
In fact, in most cases, the contractors are small companies, very dedicated/specialized in their specific segment of the business - and they are committed to do a proper job because that's their bread and butter, and they can't afford the risk to fail.
A small example is a friend of mine who produces boat covers near my holiday home in Lake Como: he always worked for most of the local yards, and before the party was over he used to have a few workers with him, and in the peak season they had to work 7 days a week.
Nowadays, it's a one man show, but the covers I occasionally commissioned to him through the years (and I'm talking of about 20 of them!) have always been just perfect - not to mention cheap, 'cause he quotes me whatever he thinks he could get from the yards.
 
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