Bombardier Recreational Products Inc. (BRP)

Bombardier Recreational Products Inc. (BRP)

November 02, 2005 14:00 ET

BRP to Transfer its ATV Manufacturing to Mexico

VALCOURT, QUEBEC--(CCNMatthews - Nov. 2, 2005) -

- ATV vehicles to be assembled in Mexico
- BRP-Rotax to manufacture ATV engines in Mexico
- Ski-Doo snowmobiles and Sea-Doo watercraft to remain in Valcourt

Bombardier Recreational Products Inc. (BRP) has informed its employees in Valcourt, Quebec, Gunskirchen, Austria and in Juarez, Mexico, that it will transfer the vehicle assembly and the engine manufacturing operations of its all-terrain vehicles (ATV) to Mexico.

The external pressures brought on by a strong Canadian dollar and Asian competition compelled the Company to turn to a low-cost country to increase profitability. This decision calls for a $30 million investment over the next three years.

"BRP is committed to the ATV business and to maintaining a solid value proposition for our dealer network," said Jose Boisjoli, President and CEO, BRP. "Our goal is to continue manufacturing while increasing profitability and becoming more competitive. We looked at various scenarios and transferring our operations to Mexico just made more sense," he concluded.

BRP-Rotax, which manufactures the engines powering BRP's recreational vehicles, will establish a facility in Mexico to build ATV engines, constituting BRP-Rotax's first investment outside Austria in 85 years.

This decision will have no impact on BRP's workforce in 2005 nor in 2006. However, BRP expects that approximately 150 jobs will be lost in Valcourt at the end of 2007 and another 150 in 2008. There will be little to no impact on Austria's headcount because of BRP-Rotax's growing external business.

Ski-Doo® snowmobiles and Sea-Doo® watercraft manufacturing operations will remain in Valcourt as BRP is completing a $10 million investment to revamp its assembly line to gain efficiency and increase flexibility.

BRP, a privately-held company, is a world leader in the design, development, manufacturing, distribution and marketing of motorized recreational vehicles. Its portfolio of brands and products includes: Ski-Doo® and Lynx™ snowmobiles, Sea-Doo® watercraft and sport boats, Johnson® and Evinrude® outboard engines, direct injection technologies such as Evinrude E-TEC™, Bombardier(i) ATV all-terrain vehicles, Rotax® engines and karts.

®, TM Trademarks of Bombardier Recreational Products Inc. or its subsidiaries.

(i) Trademark of Bombardier Inc. used under license.

This release contains certain forward-looking statements with respect to our financial condition, results of operations and business. All of these forward-looking statements, which can be identified by the use of terminology such as "subject to," "believe," "expects," "may," "will," "should," "can," or "anticipates," or the negative thereof, or variations thereon, or comparable terminology, or by discussions of strategy, although believed to be reasonable, are inherently uncertain. Factors which may materially affect such forward-looking statements include: (i) slow or negative growth in the recreational products industry; (ii) interruption of business or negative impact on sales and earnings due to acts of war, terrorism, bio-terrorism, civil unrest or disruption of mail service; (iii) adverse publicity regarding safety issues; (iv) increased competition; (v) increased costs; (vi) loss or retirement of key members of management; (vii) increases in the cost of borrowings and unavailability of additional debt or equity capital; (viii) changes in general worldwide economic and political conditions in the markets in which BRP may compete from time to time; (ix) the inability of BRP to gain and/or hold market share of its wholesale and/or retail customers anywhere in the world; (x) the inability of BRP's clients to obtain and/or renew insurance; (xi) exposure to, and expense of defending and resolving, product liability claims and other litigation; (xii) the ability of BRP to successfully implement its business strategy; (xiii) the inability of BRP to manage its retail, wholesale, manufacturing and other operations efficiently; (xiv) consumer acceptance of BRP's products; (xv) fluctuations in foreign currencies, including the Canadian Dollar; (xvi) import-export controls on sales to foreign countries; (xvii) introduction of new federal, state, local or foreign legislation or regulation or adverse determinations by regulators anywhere in the world; (xviii) the mix of BRP's products and the profit margins thereon; and (xix) other factors beyond BRP's control.

Readers are cautioned not to place undue reliance on forward-looking statements. BRP cannot guarantee future results, trends, events, levels of activity, performance or achievements. BRP does not undertake and specifically declines any obligation to update, republish or revise forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrences of unanticipated events.

Contact Information

  • Bombardier Recreational Products Inc.
    Pierre Pichette
    Vice President, Communications and Public affairs
    (450) 532-5188
    Bombardier Recreational Products Inc.
    Stephanie Vaillancourt
    Manager, Financing and Investor relations
    (514) 732-7061