U.S. Luxury Yacht Builder Moves Production To China

SAG HARBOR, NY, September 22, 2007 (The Boating Channel)



THE ASSOCIATED PRESS
KALAMA, Wash. -- North Star Yachts has laid off 60 workers in this Columbia River town north of Portland, Ore. The company is moving production to China for lower labor costs according to The Associated Press in a story reported two days ago.

About seven employees will remain at the headquarters and parts warehouse of NorthStar Yachts, chief operating officer Jerry Clark told The Columbian newspaper earlier this month.

"We tried to make it work here, but economics forced us to look at different options," said Jerry Clark, chief operating officer of NorthStar.

The company makes luxury boats from about 80 feet to 125 feet long with price tags of $6 million to $13 million, producing one to two a year. Competing yachts made in other countries are available for about $2 million less, Clark said.

North Stars 112' Raised Pilothouse Motoryacht

"A lot of the expense is labor," he said. "With cheaper labor, hopefully our sales will increase."

To maintain quality control, Northstar is establishing and managing its own operation in Zhuhai, a maritime business zone in China, he added.

"We originally went over there thinking we were going to subcontract with an existing company," Clark said.

The layoffs mark the end of three generations of yacht building in Cowlitz County. The founders of Northstar began by buying the assets of Tollycraft, which was founded in Kelso in 1936 and closed in 1998.

"This is really, really tough for me," Clark said. "I have been working with people here for 15 or 20 years, and they were like a family to me.

"Unfortunately, it's a game of survival. And this is also exciting. A few American yacht builders are already here, but in many ways we're pioneers."