It was on a razor’s edge. Exactly one year ago, the Bavaria Yachts shipyard in south Germany’s Giebelstadt was rescued from insolvency and was able to continue operations with the help of the investor CMP. The Franconian shipyard has just successfully passed its first year of restructuring.
In year 2 after the restart Bavaria Yachts plans to present two new boat model developments and some facelifts at boot Düsseldorf Boat Show in January 2020. Shipyard CEO Michael Müller in his interview with float takes a look on the achieved work in the past 12 months and gives an insight into the near future.
“We’re bringing a lot of know-how back into the shipyard.”
float: Mr. Müller, Bavaria Yachts has just had his first birthday – for the second time. The yard has survived the critical first year after insolvency. The shipyard was represented with two sail yacht models at the Cannes Yachting Festival. Which direction is Bavaria Yachts heading in the second year?
Michael Müller: We were not only represented in Cannes, but also in Southampton, Oslo, Lelystad, Genoa, La Rochelle and Friedrichshafen. Until boot Düsseldorf in January 2020, other important boat shows will follow. We have already passed important milestones for the brand and the shipyard.
Our dealer network has remained stable, and we were able to partner with new dealers in important regions. Accordingly, we were able to achieve our targets for the first financial year – which for us practically was only from October 2018 to 31 July of this year – and to deliver 350 sailing and motor yachts.
A new, more flexible working hours model gives us more possibilities in production for the current fiscal year. This means that we can do more work during the production-intensive winter months and employees can dill their overtime again during the summer months. We can thus optimize delivery times and no longer need seasonal workers during production peaks. We plan to deliver up to 450 units this year.
How have the production processes worked out in the meantime? What have you changed and improved?
CMP, the new owner, had to take care about everything at first, and we hardly had any time. We have learned from our products, from our customers and from the markets over the last twelve months. As a company, you can only do that yourself. That’s why we bring a lot of know-how back to the shipyard. That saves costs and creates more control.
We are currently investing in a new machine for our furniture production in the carpentry shop. We are also investing in new technologies and development capacity. We have to develop new boats, and that has to be faster than normal. This year alone we are investing several million euros in development.
What is produced in-house?
Our principle is “Made in Giebelstadt – made in Germany”. All the boats we build come from here. Product development, product maintenance, line support, engineering and technology will be done in-house again in the future. We give great importance to wood finishing in our own joinery, where we build all the furniture ourselves and adapt it ourselves. The quality feature of a Bavaria should be: It is a solid boat.
Other shipyards build in Poland. Bavaria does not do that. How do you manage to survive in competition?
Bavaria builds boats between 33 and 57 feet. Everyone knows: The smaller the boats, the lower the margin – and the higher the cost pressure. That’s why we don’t go below 30 feet, because here we cannot earn anything anymore. Then we would also have to go to Poland.
Mr Müller, you come from a completely different professional background than boating industry. How much does a shipyard manager need to know to run a shipyard successfully?
Good question! At Bavaria I have the impression: The more managing directors there were who thought they knew the matter, the more problems they had. I think it is important to have a certain neutrality and business efficiency.
You need basic knowledge about and an affinity for the product, but the principles of production processes are always the same. The founder of Bavaria Yachts was no sailor, too. He built windows. I am not a boat builder, but I am a technologist.
I want to improve the processes. I want us to be very close to the people who build the Bavaria yachts. Because they know best where the problems are and how we can solve them. We are currently working on this.
What do Bavaria’s customers say?
Our customers have remained loyal to us to a big extent. Many waited until the situation has calmed down immediately after the takeover – and then ordered their Bavaria. But Bavaria Yachts was not on the market for more than half a year, which of course costs customers. We think that we have finished developing the right product mix in three to four years.
CMP is itself involved in the operative business. Ralph Kudla from the investor is present as CFO in Giebelstadt. He will stay here until Bavaria Yachts is again up and running. Here in Giebelstadt we are all right in the middle of the development, setting up the management as quickly as possible.
In October we Jens Abromeit will start as the new COO for the Bavaria Yachtbau Group. He is in his role responsible for the entire production including production planning, logistics and quality/service. Furthermore, Mr. Abromeit takes over the responsibility for product development.
For boot Düsseldorf you have announced two new boats, a sailing boat and a motorboat. What can we look forward to? Can you already tell us a little bit?
Let us surprise you. I have already seen the boats and I’m thrilled myself.