By ELLEN READ
Lower fixed costs and cheaper labour have lured a multimillion-dollar New Zealand manufacturing company overseas.
Broady International, a world renowned boogie and body board manufacturer, left Auckland last week after 20 years here, in favour of a new base in Surabaya, Indonesia's second-largest city.
Brian Thorrington, a director of
the renamed Broady Indonesia Global, said the company had no future in New Zealand because it could not manufacture its product at a competitive price.
"The fixed-cost structure is way to high here, we just can't do it," he said.
Mr Thorrington said the decision was a business one rather than emotional one, and had been "hell of a hard" to make.
"Honestly, it's about survival," he said. "I don't think the Government could do [anything to keep us here]. Basically it takes cheap labour and we don't have that here."
The global body board industry is worth $US125 million a year and Broady has around 7 per cent of the market.
The company exports its boards to many countries including Australia, Japan, the United States, Spain and South Africa.
Broady's new purpose-built automated plant in Surabaya will employ up to 70 local people and produce 144,000 boards a year.
The company will manufacture its own designs, which sell for $100 to $400, and will also produce boards for other companies.
Broady had about about 20 staff in Auckland. A couple are headed for Indonesia, but most are trekking across the Tasman to a distribution centre and custom-built facility that the company is establishing on the Gold Coast.
Mr Thorrington said Australia represented about 30 per cent of the company's market, which made it an ideal centre for the distribution operation.
