Bombardier Throws OMC Owners a Lifeline

Boat/US Magazine, May, 2001 by Caroline Ajootian

Months of nail-biting and anxiety are over for owners of new Johnson and Evinrude engines, thanks to some good news from Bombardier, Inc., the $10.3 billion Quebec conglomerate that, among other things, builds Sea-Doo personal watercraft. Bombardier purchased Outboard Marine Corp.'s engine operations earlier this spring and announced it will provide consumers with warranties for 2000 and 2001 OMC engines, along with a steady supply of repair parts for earlier OMC engine models.

OMC declared bankruptcy late last year, at which time warranty coverage was completely eliminated and parts supplies for its products dried up.

Bombardier's decision spells relief for consumers who were nervous that their engine investments were in jeopardy. With the average outboard costing about $8,000, consumers feared their engines could quickly become very expensive throwaways if they had no way to get them repaired.

OMC's assets were sold at auction in early February. Bombardier and Genmar Corp. of Minneapolis won the sale with a joint bid of $95 million. Besides Sea-Doos, Bombardier manufactures Lear jets, regional aircraft, rail transportation equipment, snowmobiles, all-terrain vehicles and golf cart-like NVs or "neighborhood vehicles."

Genmar, parent to over a dozen boat-builders, including Wellcraft, Carver, Hatteras and Larson, took control of OMC's boat companies, leaving OMC's Evinrude and Johnson engines and Ficht Ram Injection technology to Bombardier.

"Bombardier will support the original product warranty in relation to all 2000 and 2001 Evinrude two-year warranties and all 2000 and 2001 Johnson one-year warranties," announced Roch Lambert, Bombardier vice president and general manager. Coverage is identical to the original warranty given by OMC.

Warranties currently in effect will continue until their original expiration dates, two years from the date of sale for fuel-injected engines and one year from the date of sale for carbureted engines. Warranties do not begin anew with Bombardier's purchase of OMC's assets earlier this spring.

Although there are no legal requirements that buyers of bankrupt companies assume warranties or other liabilities created by the predecessor company, it certainly makes good business sense to do so. Genmar also announced that it will warrant certain boats sold during the OMC regime (see story at right).

"Our dealers can continue to sell the Evinrude and Johnson brands and be confident that a strong warranty system will support them," Lambert said. "We want customers to know we are supporting them and that we are supporting dealers who are standing behind these brands."

"Engine owners will be able to contact any authorized Johnson or Evinrude dealer for service," said Henry Wilson, Bombardier's North American service manager. A dealer review process is being implemented, so dealer ranks may change after a few months.

Owners of 2000 and 2001 Evinrude and Johnson engines will receive letters from Bombardier, outlining ways to obtain product information, locate dealers, access Web sites and "follow up with company representatives on unresolved issues."

Again, that's more good news for consumers who until now had no other recourse than to submit proofs of warranty claims to the bankruptcy court. Unsecured claims submitted in bankruptcy proceedings will receive settlements of only a fraction of their face value because there are not enough assets to go around. With OMC's debts in excess of $768 million, offset by the $95 million Bombardier-Genmar bid, consumers were not likely to fare well.

As this issue of BOAT/U.S. Magazine goes to press, however, the status of OMC extended service contracts is not certain. It's likely that contracts for older engines will live on, probably on a reduced scale.

Wilson said that Bombardier is reviewing the OMC product line-up and will probably make some changes. "Product development is an on-going process," he said. Regarding the trouble-ridden Ficht fuel injection engines developed by OMC (see story, page 16), Wilson said these, like any other product, would be undergoing product review and improvements in the coming months.

"During our start-up phase, there will be some snags here and there," Wilson told BoatU.S. But, he said, boat owners should "keep the faith. We will have new products and will be moving forward."

Contact Bombardier customer service, 847-689-7090, for information about warranty coverage or service for Evinrude and Johnson engines.