BRP has eliminated 8.5 percent of its “white-collar” workforce, cut back next year’s production by 20 percent and restructured its business divisions in reaction to the current economic turmoil.
BRP officials, who also announced temporary layoffs to hundreds of “blue collar” workers, said the moves would not affect current dealer programs.
“These are very difficult decisions to make, but we must take appropriate preventive measures considering the seriousness of the situation,” Jose Boisjoli, BRP’s CEO, said in a press release. “We believe these measures will reduce our costs and make BRP less vulnerable to drastic declines in revenues caused by events outside our control, such as the current crisis.”
The Canadian-based manufacturer’s measures to combat the crisis included:
n Temporarily laying off 430 blue-collar employees in its fourth quarter after 370 employees received temporary layoff notices in the company’s third quarter. Among its white-collar workers, 550 were laid off;
n Cutting back R&D. BRP told Powersports Business the company would slightly reduce annual R&D funding and have it more focused on priority projects. BRP officials would not specify the percentage of the R&D funding cutback;
n And several changes to its business structure, including to Ski-Doo and Sea-Doo. Previously the manufacturing, sales and marketing for those brands were managed under one division. With the restructuring, sales and marketing were placed in a separate division from vehicle development and manufacturing.
The business restructuring includes creating a Can-Am and customer service division, which will include sales and marketing for Can-Am products in the United States and Canada. This division also will develop a worldwide strategy for parts, accessories and clothing as well as handle customer service and the dealer support network.
BRP also will merge its Rotax and Evinrude outboard engine divisions and create a separate vehicle development and manufacturing division.
“We are confident these initiatives will help us come out of the recession a stronger company because this new structure provides us with the tools to focus on cost reductions, market strategies, product launches, product innovation and to maximize synergies in both the vehicle development and manufacturing division and the powertrain division,” Boisjoli said in the press release.
The restructuring does not call for closing any of the company’s manufacturing facilities, which include locations in the United States, Canada, Mexico, Austria and China.
BRP also said it does not expect the changes will impact current dealer programs.
“Over time we hope to be able to better leverage each others’ strengths and improve areas like dealer support and development,” said Pierre Pichette, BRP’s vice president of communications and public affairs. “For example, by investing in synergies between call centers we can improve the level of service to the dealer network or improve access to advanced technical training by utilizing shared resources.”
The planned production decrease for the company’s 2009-2010 fiscal year follows another manufacturing cutback. Boisjoli told Powersports Business previously that BRP decreased its ATV production in the fall by 20 percent.
— Neil Pascale
Copyright 2008 Powersports Business