On the move

Maverick Boats President Scott Deal considered every state in the Southeast for a new production facility to house Cobia Boat Co., which he bought from C&C Manufacturing Inc. last year.

When he went looking for a site, he developed a list of objectives, including an available and trainable workforce, a good business climate, community response, a desirable location from quality of life and logistical perspectives, and available incentives.

Deal quickly narrowed the finalists to North Carolina and South Carolina, saying he was impressed by both states. His native Florida, however, had what he calls “an empty tool kit.”

“I was not at all impressed with Florida from a state perspective,” Deal says. “I got every indication that they don’t care. We ultimately chose North Carolina based on our sense of local incentives and motivated by the locals who seemed determined to see us successful. We got the feeling they really, really wanted us.”

Every state strives for the Holy Grail of economic development, a cluster of like businesses in a particular industry segment.

Some states, most notably North Carolina, have begun to focus specifically on the marine industry, while South Carolina has trained its sights on the wider recreational industry. But states across the Southeast are throwing their arms wide to embrace what appears to be a groundswell of relocating builders.

Judging by the sheer volume of recent movements by marine manufacturers, there’s little doubt that companies are weighing all of their options when considering growth needs or contemplating a new plant. States across the Southeast are lining up to grab what they consider their fair share of this business, waving incentives, tax credits and worker training to attract boat builders.

An attractive business
Boat builders are particularly attractive to many states because of the high-quality jobs they bring and their dedication to local markets. Most marine companies are privately held, family-owned entities, and when the president or CEO speaks, his words are backed up by the company’s reputation.

Conversely, one of boatbuilders’ main attractions to the Southeastern states is its labor pool. Shuttered furniture plants are scattered throughout the region as that industry transitions to producing goods offshore, leaving empty buildings and workers accustomed to a manufacturing environment.

Maverick, which produces and markets the Maverick, Hewes and Pathfinder brands of saltwater fishing boats, had no room at its Fort Pierce, Fla., headquarters for the Cobia operation. While the Cobia acquisition included the brand, customer base and dealer network, it did not include tooling, which C&C needed to continue to build Century Boats.

“We worked with the locals [in Fort Pierce] and identified 20 acres along I-95, but we would have had a nice facility with an ‘employees needed’ sign out front,” says Deal, noting Florida’s low unemployment. “So we decided to look at options elsewhere.”

Cobia began producing boats at its Marion, N.C., facility in April with an initial employment of slightly more than four dozen, a number expected to climb to 300 within five years.

Lisa Nason, vice president of communications and organizational development at Enterprise Florida Inc., says the state has an aggressive package of incentives available to boat builders.

“We hate to see any jobs leave the state of Florida,” Nason explains, “but we realize that some companies have other business plans.”

Enterprise Florida is a public/private economic development partnership that focuses considerable effort on attracting high-tech and high-wage jobs as well as high-dollar capital improvement projects.

“Manufacturing is one of our key sectors, and boating manufacturing surely is a strong fit,” Nason says.

But the state has among the lowest unemployment in the nation and has led the country in job creation for nearly four years, which can make finding qualified workers difficult. Add in the persistent threat of hurricanes and the escalating costs of real estate, and its no surprise many boat builders are finding safe haven elsewhere.

Destination: Carolinas
Both North Carolina and South Carolina, the runner-up for the Cobia project, have seen steady increases in the number of boating manufacturers interested in moving or expanding into the states.

Jack Ellenberg, director of global business development for the S.C. Department of Commerce says the state is interested in opportunities across the recreational spectrum, from boating manufacturers to companies that produce ATVs, personal watercraft and fishing tackle, building on its existing base of manufacturers.

“We’re now aggressively pursuing the industry with targeted marketing, talking to companies at trade shows or interfacing by other means to let them know that South Carolina is a great place to do business,” Ellenberg says.

South Carolina’s Center for Accelerated Technology Training has been working with qualified companies since 1961 to produce a work-ready workforce at little or no cost to the employer.

The South Carolina Manufacturing Extension Partnership announced last year an expansion of its composites program in an effort to increase the number of composites manufacturers using advanced technology in a range of industries, including the marine segment.

North Carolina’s Small Business and Technology Development Center has a division dedicated to the marine trades, which encompasses 20,000 jobs across the state and produces $500 million annually in sales of boats, motors and boating equipment, says Mike Bradley, program director for Marine Trade Services.

The state has gained more than its share of boat builders in recent years, including PDQ Yachts in Edenton, Southport Boat Works in Leland, and, of course, Cobia Boats in Marion. Bradley says he’s currently working with more than a dozen companies that are looking to relocate.

“I don’t care where (boat manufacturers) go in the state as long as they have what they need where they locate to be successful,” says Bradley.

The North Carolina Marine Training and Education Center at Carteret Community College in Morehead City, N.C., recently issued $8 million in bonds that includes a training facility focused on cold-molded and fiberglass production, marine propulsion, outboard motor training and electronics, Bradley says.

The Edenton campus of College of the Albemarle recently completed a new building that will be used, in part, to offer lamination and assembly classes geared toward the marine industry. Local community colleges work together to offer programs geared to the training needs of the workforce, says Lynn Hurdle-Winslow, the college’s vice president of corporate and continuing education.

Developing for success
The Carolinas aren’t the only states attracting boatbuilders, however. Successful companies attract others like a beacon, which is what seems to be happening in East Tennessee around Lake Tellico, and the 11,000-mile Tennessee Valley Authority waterway system that offers access to the Gulf of Mexico.

Cobalt Yachts is putting the finishing touches on a 375,000-square-foot building in the 1,500-acre Tellico West Industrial Park, joining such builders as Sea Ray Boats, Mastercraft Boats, Tennessee Watercraft and several boat supply companies. Cobalt is expected to employ 350 and produce 200 yachts a year.

“We feel like we’re developing into the headquarters for the production of recreational boats,” says Ron Hammontree, executive director of the Tellico Reservoir Development Agency, part of the 16-county Knoxville-Oak Ridge Innovation Valley. “We’re going to claim that until someone disputes it.”

The 16-county region employs 3,300 in the boating industry, says Hammontree, adding that East Tennessee is within a day’s drive of 75 percent of the U.S. population.

Georgia is also waking up to its potential as a base for marine manufacturers. Contender Boats announced a major relocation from its Miami headquarters to the southern Georgia town of Baxley. The company chose a 25-acre site with an existing building in West Appling County Industrial Park for its operations

“[The move] was an eye-opener to us,” says Chris Clark, deputy commissioner of the Georgia Department of Economic Development. “It’s one of those great trends that we didn’t expect.”

The project, which is forecasted to bring 424 permanent jobs to the area over the next five years, warrants use of state discretionary funds and workforce training incentives, Clark says. Georgia’s QuickStart training program has been named tops in the country by Expansion Management magazine.

The state is working with the Georgia Department of Technical and Adult Education and the University System of Georgia to check into offering specific training programs in boat design and materials handling and recruiting students for these programs.

“We want to work with (boat builders) because of the positive attitude they bring,” Clark says. “They’re not looking specifically for incentives, and the communities say they’re going about (relocating) in the right way.”

Off the beaten path
While the Southeast has become one of the most attractive locations for boatbuilders, states in other regions are working to improve the environment for their current boatbuilders, which may attract new builders.

Maine’s boat-building tradition dates to 1607, and the industry employs an estimated 5,000 workers. A coalition of state government officials, universities, businesses and research facilities known as the North Star Alliance recently received a $15 million, three-year grant from the U.S. Department of Labor aimed at creating 2,000 new jobs in advanced composites over the next several years.

Bringing mainly small boat builders together is among the primary goals of the alliance, says Stephen Von Vogt, president and CEO of Maine Marine Manufacturing LLC, based in Portland.

“The desire to grow jobs and markets for our products is more important than competing for other boat builders,” Von Vogt says. “It’s not just to get bodies, but to develop quality jobs to have so we have something that isn’t a commodity,” he says, noting that U.S. manufacturers compete better globally by offering high-end products.

Grant monies will be used for training new and incumbent workers, market research and brand promotion, research and development around developing new products and improving existing ones, and capital and infrastructure development.

“The greater critical mass we have, the greater the success for boat builders in Maine,” Von Vogt says.

Helping to attract and support that critical mass is also a goal of the Northwest Center of Excellence for Marine Manufacturing and Technology, based at Skagit Valley College, Mt. Vernon, Wash.

“We’ve already done a lot to bring the industry together: manufacturers, labor, vendors and government,” says Dolores Blueford, center director.

The center is funded through the state board of community and technical colleges focused on what it considers “driver” industries, including marine. The center for excellence offers programs in resin infusion, electrical, aluminum welding, carpentry and safety, and colleges throughout the state have classes and programs aimed at the marine industry.

“While I can’t say whether or not any company has located in our area because of our training, a criteria for boat builders moving into the area is the excellent training available in the state,” Blueford says.

Because the needs of any one marine manufacturer vary widely from the needs of another, no state can craft the perfect combination of land, buildings, incentives, training or other programs to appeal to a large number of builders.

But that fact won’t stop states from trying, which bodes well for boat makers that believe a change of scenery may be in their future.