New Brunswick closes its shipbuilding plant in Brazil

Brunswick Boat plant in Joinville, Brazil

After the Bénéteau group, Brunswick also closes its factory in Brazil. The South American boating market is struggling to recover.

Closure of the Joinville plant

The Brunswick group announced on March 23, 2017 the forthcoming closure of its Joinville plant in the province of Santa Catarina in Brazil. The production site manufactured several models of Bayliner and Sea Ray boats for the South American market. The Brunswick group indicates that it is slowing down until the plant is completely closed. The group's other plants around the world will then take over.

Too weak a market

Brunswick had opened its 14,000 m² factory in Brazil while the local market was at its peak, to avoid an import tax of 40%. As Bénéteau did a few months ago, the group now finds that the Brazilian market does not allow it to continue on the local production model, as explained by Huw Bower, president of the Brunswick group.

"The economy, which remains weak in the region, has made it difficult to serve these markets profitably with a dedicated production site. With our existing commercial infrastructure and distribution network, we can return to our old model of importing boats into the region, to more effectively meet the demand of this important market

Limited financial impact

The Brunswick Group estimates the cost of restructuring to be between $10 million and $12 million, before taxes. It indicates that the impact on earnings will be minimal in 2017, with the majority of the effects expected in 2018.

New Brunswick states in its press release that the decision will have no impact on its strategy for Mercury Marine and fitness activities. The difficulties in the region had a greater impact on the boat sector than on the rest of the group's activities.

More articles on channels: