Bénéteau’s Bruno Cathelinais

Bruno Cathelinais, became President of Group Bénéteau when Annette Roux stood down last year. Group Bénéteau recently reported 2004 - 2005 sales of €799.2 million, with sailboat sales up 6.5% and motor boat sales up 22.2%.

AG-C. China now or ten years ?

BC. Not now and not in 10 years. Maybe in a few months, because China is a crazy country; it seems the time is not the same time as in Europe. I mean when you say 3 months in China it is 3 years in Europe.

At Bénéteau, we have just begun. We have opened a sales and marketing office two weeks ago and we begin. The goal of this office is to promote the design brand, for the brand is very important in China. The brand is the most important thing, you have to keep absolutely to the brand and promote the brand first of all. Then you have to organise a dealer network, that’s very new for China and we don’t know how much time this will take. Those are the first and second objectives of this office. For me, we can expect some boat sales in 2006, maybe, and I am sure we will have a few boats at the 2008 Olympic Games in Shandong..

AG-C. There is a 40 hectare marine site being developed in Shanghai would you be interested in taking part of that development?

BC. No, no, always in the past and think it will be the same in the future we have concentrated our efforts on our business, our core business. It means we create, we build boats and we sell boats.

AG-C. Thirteen new members have joined the European Union do you regard these as a potential sales area, or an opportunity for cheaper manufacturing?

BC. It is an opportunity, a low opportunity now and bigger for the future. At the end it is a marginal additional turnover, because the number of people who are able to purchase a boat is limited compared to Germany, England, Italy, Spain & France. These remain the five main countries in Europe.

AG-C. Hurricane Katrina devastated much of the US Gold Coast. Not withstanding the human loss, do you consider this a disaster, or a potential  sales opportunity once insurance claims are settled?

BC. I don’t know exactly the situation of the boatbuilders in this area and when you ask is it an opportunity for Bénéteau, I don’t think so. Each disaster brings business in terms of repair and spare parts, but not new boats, because you can repair a boat even if it is severely damaged.

AG-C. Will rising oil prices have a major impact on sales soon and, perhaps more importantly, on production costs?

BC. As a boat builder we are lucky, because in the cost of the boat there are so many choices and so many materials that the effect of oil is limited. Wood, engine, resin, glass, the mast, the rigging there are so many different things in a boat, it means when only one raw material increases it has an impact, but only a weak impact, on the overall cost. For instance last year, if you consider the evolution of the increase in the resin it cost 1%. That is big for one material but, globally, it is not very big. I think where we have an impact is on the customers who use our boats, maybe they will be worried and, for that reason, everybody works on new engines, more efficient engines, gaining savings on fuel. So, with new models and new engines each year we save oil.

There is now discussion that the UK will lose its EU derogation on commercial boat diesel that can be sold very much cheaper than normal diesel. This could have an effect on small power craft sales, maybe between 6 and 9 metres, because the customer will be afraid of that. 

Questions about Group Bénéteau.

AG-C. Madame Roux started the Bénéteau of today, when she persuaded André to exhibit the Flétan at the 1965 Paris Boat Show and has clearly been a big force is shaping the growing of the company. Are there going to be any changes now that she has stepped down?

BC. I think the change is relatively low, because it is an evolution as I have worked with Mme Roux for a long time -15 years - and she is still the boss, because she is the main shareholder. It is not that she is in the daily operations, she is not there, but I have many contacts with her. I think we share the same values and we have organised the managers for a stable management; they know the company and the values of the company and we are going to follow the initial development. I think the customers will feel the company is exactly the same in the future.

AG-C. Bénéteau and Jeanneau are synonymous with sailing yachts, but there is now an increased focus on motor boats and they seem to be targeting the 9 to 12 metre range that many yards are phasing out, because of demand for bigger boats. Does Group Bénéteau see this as a potential sales growth area?

BC. We are not focused on the power boat, the first aim of the Bénéteau Group is to continue to be world wide leader in term of sailing boats. The addition strategy is to be important, in Europe, in power boats. We consider the two brands and the ranges we have organised, especially between 9 metres and 15 metres, where we had no presence before 2000, gives us the opportunity to enter the top 5 and I think that will be the case at the end of 2005; we have to check that, but I think it will be the case. After that, I consider that, by 2008, we have the opportunity of the third position after Azimut and Ferretti.

After that short period, because 2008 is tomorrow, we have to consider the next step and that will be probably two things; first is an additional range and second it means other sizes. I don’t say more. Also an additional area, which means outside Europe; probably we can consider that.

AG-C. Bénéteau yachts have a superb ocean racing record, yet there are still significant numbers of sailors who would not buy one, as they cannot accept that a mass produced yacht can be as good as one produced in smaller numbers. Do you have a strategy to overcome this?

BC. I think mass production is the opportunity to have a better quality, because you can use modern tools, good material, better raw material than when you build a few boats per year. On the other hand, I think the difficulty is to be close to the customer when you sell so many boats, that’s the reason why the dealer network is so very important. The future will depend on the dealer network, if it is very close to the customer, then the customer will be sure of a good quality product, but also a good personal relationship. I think that is the complaint, the big complaint when the customer says “I am nothing, I appreciate this brand, this range, but I feel I am nothing and I put much money on the table”. It means we must be concerned and focused on the relation with the customer, because we sell every year nearly ten thousand boats and to be close to the customer, each customer is important, because it is a big decision for them and they merit continuation; that is the role of the dealer network and we have to work on that.

AG-C. Is the present demand for more comfort and space in yachts presenting design and cost challenges?

BC. The volume and space is a really big concern in terms of design. It not a problem in terms of cost, but a real problem in terms of design. There is always the same challenge, between the functionality and the design. If you are in the USA the first criteria is the function and if you are in Italy the first criteria is the design. We have to organise in today’s case, and it will be the case tomorrow, we have to organise a compromise between the functionality and the design. It is not easy, it is not at all easy. The creative people are so important in our business, because it’s a kind of cosmetic surgery when you create a boat; one millimetre wrong and it is not the same result. Do you understand?

AG-C. Yes I do. Thank you Bruno Cathelinais.