NYT Hinckley Story

[Soundbounder]

Debt Trips Up Hinckley

http://www.nytimes.com/2009/10/10/business/10hinckley.html?hp

This was in the New York Times over the weekend.

[Oldrig]

Here's the perspective of somebody who lost his job as the boatbuilding industry collapsed:

Gotta love the venture-capital boys. They kept passing the company along, loading it up with debt. Somewhere down the line, they forgot that what they were supposed to be doing was building boats.

Then, when money got tight, they started slapping customers with mechanics liens after 30 days -- without bothering to contact them first.

And, who do you suppose made the decision to move from beautiful, hand-crafted (and over-priced) sailboats to flashy, pseudo-Down East powerboats with twin jet drives (and an even higher price)?

--Joe

[Shipscarver]

Gotta love the venture-capital boys. They kept passing the company along, loading it up with depth. Somewhere down the line, they forgot that what they were supposed to be doing was building boats.

They never had any interest in boat building, or car making, or housing, etc. The companies involved met the financial statement paramiters that allowed them to take on massive debt, which could be drained off in the form of instant cash in the pockets of the $$ boys in the form of management/consulting fees and charges for equipment or services from other companies they own, leaving the company weak but still looking viable enough to sell. The problem with this approach is always the same, last man standing takes the financial beating (that's why many go public to make the dump). And, the industry suffers whiles the employees take gas.

[Oldrig]

This sad tale stands in interesting contrast with another Maine builder of classic, overpriced beauties: Morris Yachts.

The company is still family owned, and their boats are definitely to die for.

I only met Cuyler Morris once, and he seems like a real, down-to-earth guy who loves what he's doing, like his late father.

No, I don't think that half-a-million-dollar "daysailers" are the way to go, but they build beauties, service them and remain loyal to their customers.

Best of luck to them and the other small builders who are trying to hang on.

--Joe

[CapnK]

^^^ I'm with Joe... ^^^

:D