Corsair Marine is sunk by high land clearance costs

Vung tau city - illustration photo

The company had officially given up on the project in Vung Tau city, said Huynh Xuan Vinh, head of international cooperation and investment for the Ba Ria-Vung Tau Department of Planning and Investment.

“Late last year, Corsair’s leaders complained they could not afford the cost of site clearance and had decided to withdraw from the project,” said Vinh.

The Department of Planning and Investment was now finalising procedures to revoke its investment certificate, Vinh added.

Corsair Marine International’s 27 hectare project was granted an investment certificate in July, 2007. But by the end of 2010, the firm waited for a land grant so it could start building the production facility.

While Corsair Marine International blamed the high costs of site clearance for its decision to pull out of the project, the firm did not name the figure in question.

“The investor agreed to cover site clearance costs so they had to negotiate with residents and calculate those costs. We don’t have the specific number but we acknowledge that site clearance costs have been rising sharply since Decree 69/2009/ND-CP took effect,” Vinh said.

The decree, which came into force on October 1, 2009, means that compensation costs for agricultural land could be 1.5-5 times higher than before.

But Vinh said that Corsair Marine International’s failure to provide an exact figure for the costs of land clearance was evidence it was actually ending the project because of the impact of the global financial crisis.

Established since 1984, Corsair Marine International has sold more than 1,600 trimarans through its global dealership network. Dealers represent and service Corsair Marine’s trimarans in over eight regions of the United States and 17 other locations around the world.

Currently, the firm has a single production facility in Ho Chi Minh City, which was set up after the company decided in 2006 to relocate its head office and production facility to the city from San Diego.

The firm said that relocation created an opportunity to avoid charging higher prices.

According to the company’s website, Vietnam was chosen for “its political stability, attractive foreign direct investment provisions, booming economy and its young, talented, skilled, energetic and resourceful workforce”.