Stabicraft to lay off more staff
Invercargill boat-building company Stabicraft Marine is proposing to lay off 31 workers, just a month after the company let go 28 people, Stuff understands.
A final decision on the latest redundancies proposal is set to be made in early May.
It’s understood the news was delivered at a staff meeting on Tuesday.
Staff were shocked and felt “stressed and upset”, an employee said.
The employee believed the Southland public should know about the redundancies, in the hopes other employers could offer the laid-off workers jobs.
Stuff understood that reduced demand for Stabicraft boats early this year resulted in the company reducing its production capacity to 60 to 65 boats per month, but that it now expected demand to be about 30 to 40 boats a month for the remainder of the year.
Stabicraft chief executive Aaron Greene did not confirm the latest number of redundancies to Stuff.
However, he released a statement confirming a meeting was held in which proposed staffing level changes were announced in response to continuing deterioration in the market for new boats.
“We are now consulting with staff about those proposed changes that involve ways to reduce production costs, including reducing staffing levels across the business,” Greene said.
This followed an earlier consultation process in February that resulted in Stabicraft Auckland closing, and all manufacturing being relocated to its Invercargill yard.
The production capacity of Stabicraft Invercargill was reduced at that time, resulting in a reduction in staff numbers, understood to be 28, last month.
Greene said those changes had not been enough to meet the “dramatic decline” in sales.
Economic conditions in New Zealand had caused a significant slowdown in the demand for luxury goods, which had directly impacted Stabicraft.
“We continue to explore ways to reduce costs across the business and consider all options before we look at reducing staff, but the reality is we are not able to keep up the current level of production, and need to respond in a way that’s sustainable for the business,” Greene said.
“This is a tough time for Stabicraft, as it is for many in the wider marine industry, and this is not the position we want to be in to make the difficult decision to downsize our workforce.”
Greene said the company was doing its best to support its people.
It had been and was still in discussions with Southland businesses and industry partners about outplacement opportunities, with a number of its workers already getting jobs elsewhere.
“We are continuing to work with those organisations on further opportunities, and welcome any other offers of support from our Southland community.”
He said he remained confident in the future of Stabicraft.
“We are taking these steps to ensure we are well positioned to respond when growth returns to the market.”
Southland Business Chamber chief executive Sheree Carey said the staff layoffs and proposed layoffs at Stabicraft were sad for the “iconic” Southland business.
“I feel for the staff because it’s a tough [job] market out there as well.
“Unemployment rates are low but businesses are hesitant to take on new staff because people are their biggest cost.”
Carey believed the next six months would be challenging for businesses.
“We are expecting more redundancies to come as businesses tighten their belts.”
When successful Southland businesses such as H&J Smith closed and Stabicraft cut staff numbers, it showed how tough it was for all businesses, she said.
“The economic climate they are working in is really challenging. The cost of everything has gone up, and a lot of businesses aren’t passing it on to their clients. They are wearing it, but at some stage they will have to pass it on.”
The hard times for Stabicraft have come after an expansion of its operations, opening a manufacturing plant in Seattle, in the United States, in late 2022, to pursue what it saw as considerable growth opportunity.
With its focus shifting to manufacturing, it sold its retail branch to Trev Terry Marine Ltd, which also had dealerships in Taupō, Turangi, Kinloch, Napier and Wānaka.
Trev Terry Marine has since gone into receivership, with receiver Neil Jackson saying it was “tough market conditions out there’’.
Yesterday, Greene did not answer an emailed question about the current status of Stabicraft’s Seattle plant.