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Winnebago buys Chris-Craft

Discussion in 'General Yachting Discussion' started by PacBlue, Jun 6, 2018.

  1. PacBlue

    PacBlue Senior Member

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  2. olderboater

    olderboater Senior Member

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    Interesting exit by a private equity company so that's not surprising. The changes in Winnebago will be interesting to follow as their CEO, whose experience prior to 2016 was with lawn mowers and has increased Winnebagos presence in the Twin Cities so he can keep living there, has not attachment to the RV industry so doesn't see them as an land RV company but as a recreational company and in a more global manner rather than the way someone whose career was with Winnebago would see things. Only time will tell whether it's a good move for them.
  3. Jorge Lang

    Jorge Lang Senior Member

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    Wow, anyone else envision a Chris Craft houseboat?
  4. YachtForums

    YachtForums Publisher/Admin

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    Interesting indeed. I'm not privy to the numbers, but I don't think Chris Craft has been well-received by the market in recent years. They tried to command a premium on a legendary name, but the boats aren't really a premium brand anymore. No doubt they are nicely appointed, but in the ever crowded center console market, $350,000 for a 30-foot center console feels like unarmed robbery.
  5. PacBlue

    PacBlue Senior Member

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  6. Jorge Lang

    Jorge Lang Senior Member

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    I had no idea, but I predict a comeback!!!
  7. olderboater

    olderboater Senior Member

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    The CEO of Winnebago, built quite a reputation at Toro for his branding and marketing acumen. That's what got him hired. Chris Craft will be his chance to show what he can do.

    No, Chris Craft has been a fringe player in the industry. They've carried a premium price but haven't earned it with today's buyer. They've also been slow to adapt. They were primarily building closed bow boats while bowriders were what was selling. Then they were slow to see the outboard market pick up. Then they toss in the Commander which doesn't fit at all with their line. One thing mentioned ever so briefly in the article is working on their dealer network. That will take a lot of work as they don't have the best dealers in their markets, typically having perhaps the 4th or 5th dealer or poorer.

    I'd say their first step is figuring out who and what they want to be. Is it the cabin cruiser as in the Commander? If so, that boat is sadly underpowered for what you'd hope from Chris Craft and overpriced versus competition. Are they targeting the coast, the Great Lakes or Inland lakes?

    Will we see large Winnebago dealers encouraged to sell Chris Craft? Will Chris Craft dealers be given the floor plan and incentive support to stock boats like Winnebago dealers are?

    Who do they intend to take business from? I would say that the uncertain situation with Sea Ray could make this the ideal time for an aggressive effort.
  8. PacBlue

    PacBlue Senior Member

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    Or, like most ceo’s of today, he can show revenue growth by acquiring other companies. Impress the stockholder today. Classic move in a cash rich situation. Most ceo’s bonuses are tied to revenue growth, he should have a nice one for 2018.

    We would have to understand CC’s manufacturing capacity before comparing the situation to SR. In my opinion, the SR deal has more upside.
  9. olderboater

    olderboater Senior Member

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    The Sea Ray deal has more upside, but there's a huge opening while Sea Ray flounders while Brunswick tries to sell it. Sea Ray won't even be in the top 3 by the time the sale happens. Chaparral and Cobalt definitely taking advantage.
  10. PacBlue

    PacBlue Senior Member

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    Hard to determine an overall rank among different companies that do not produce big production boats - 40 - 65'. What is the overall top three criteria - units, revenue, or what?

    Surprised the SR deal has not happened yet, heard the first round went without any legit takers, but was expecting an announcement of a potential Private Equity group purchase lately. Maybe the Brunswick terms are not so attractive at the moment?

    It will be interesting to see how the RV guys take the Chris-Craft brand. The car guy experiment at SR was a mixed bag, with some of the long term effects seen now. I am sure they have ideas on their own manufacturing process versus what is going on today, but land yachts are a much easier build in my opinion. I am also sure they feel like they can leverage profits by using their own Supply Chain, it will be interesting to see what the new look / new quality standards will be for the brand. They probably have better purchasing power on fiberglass and resin, so that should immediately help CC bottom line.

    This comment concerns me a bit: "The luxury customer base is typically less sensitive to fluctuations in the economic cycle, Winnebago said." Having secured my living solely from the marine industry since 1988, I can tell you that the cycles are vicious, and you have to operate your business with a keen awareness of these cycles, especially how it impacts your workforce.

    Another comment from Winnebago: "Importantly, this acquisition aligns with our strategic initiative to further diversify Winnebago Industries within the outdoor lifestyle market and gives us a strong base on which to consider building an additional revenue platform over time,” said Winnebago Industries president and CEO Michael Happe . Sounds a lot like the Brunswick rhetoric of old!
  11. Capt Ralph

    Capt Ralph Senior Member

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    Let me look under the box;
    If Winne wanted a chunk of land, fiberglass mfg equipment, Cad-Cam to mold technology & equipment, a roof over it all,
    who knows what other assets, maybe 15 to 20% employee retention, and a name;
    They could start making THE real land yacht,,,, A Chris Craft land yacht...
    Maybe a more stable market?

    I predict a motor coach like the old glass GMC coach but with fancy tooling and options.
  12. d_meister

    d_meister Member

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    Seems like a natural fit, to me. There are some scale benefits from similar appointments, like SeaLand heads, house water pumps, roto-molded tanks, plumbing fittings, batteries, inverters, generators, lumber, windows, wire, and the fiberglass capabilities Ralph mentioned.
  13. YachtForums

    YachtForums Publisher/Admin

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    With all the points noted above, the acquisition makes sense. I feel some synergy with Chris Craft now... our initials are CC and we're both Campers. :p
  14. PacBlue

    PacBlue Senior Member

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    Well, it will be interesting to see how the RV guys do in the Marine world. It’s nice to have some new blood in our industry, we tend to be a small group of survivors, a little inbred even, lol!

    Good luck to Winnebago, wish them much success and looking forward to seeing their handiwork.
  15. JWY

    JWY Senior Member

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    LMAO!
  16. Oscarvan

    Oscarvan Senior Member

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    I am way too familiar with the RV industry and it's practices. While Winnebago has shown some promise in the product development department, their execution and customer care are no better than the rest of the RV industry, and that's not very good. If CC is going to exercise the same level of care it will be a said affair.
  17. Fishtigua

    Fishtigua Senior Member

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    Or they could build one of these on the line. ;)

  18. olderboater

    olderboater Senior Member

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    Or

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