Reggie Fountain isn't logging a whole lot of time in offshore race boats these days, but you could argue that the 67-year-old founder and CEO of Fountain Powerboats in Washington, N.C., is moving faster than ever. In fact, since Fountain was slated to complete its purchase of Baja Marine Corp. in May, it's safe to say its fearless leader has been running at wide-open throttle. At press time, speculation on everything was rampant, including where Baja models will be built, if the larger Baja sport boats would be discontinued and if Fountain would add steps to Baja hulls. We caught up with the affable CEO to set the record straight.—Matt Trulio

Why did you decide to buy Baja Marine?

To spread my overhead. My long-term partner, Brunswick, was in the market to sell Baja and they made me a good offer. I can build both lines in one factory without expanding my overhead—I can use the same accounting, the same sales force, the same engineers. I might have to add a double shift in lamination and mating (joining hull and deck), but that's it.

Now, if you haven't noticed, there's been a slight drop in the marine business (laughs). Our business this year will be $68 million or $69 million—it's been as high as $80 million. Baja, too, was down substantially, but still around $50 million. If my business went down to $60 million, and theirs went down to $25 million, I'd still be doing more, building both lines, than I did in my best year with just Fountain. And again, I'm spreading the overhead. I'm not running two factories and I'm not expanding my factory.

Brunswick made me an offer that was hard to refuse, so I took it. It keeps my overhead really low because I can spread it between two companies without expanding.

Were other buyers interested in Baja?

You'd have to ask Brunswick. I think they just wanted to sell it to me. Why? Well, who's the biggest buyer of power in the world from them? Fountain. They wanted to protect their business. How many boats does each company build a year?

Baja has built as many as 1,200 and we've built as many as 450. How many can we build here without expanding? With second shifts in lamination and mating going, probably 700 to 800. So which ones wouldn't we build? Well, that depends on what sells, but my main goal would be to stay sold out and that would determine what we build.

If it turns out we need more, we could go to triple shifts. And if I need more space, the county (Beaufort) here has agreed to let me build. But right now I don't want the overhead. I think I'd rather be sold out all the time.

If we're at half of the maximum volume each company has done in its best years, that would be about 800 boats and I would still be doing very well. Baja is basically like an insurance policy to keep us running. I believe in insurance. If you know my background before I started in the boat business, I was a supped-up life insurance agent with a law degree.

This acquisition obviously makes Fountain Powerboats the world's largest manufacturer of performance boats. Did you ever imagine that when you started?

We already were. This just makes it that much more. Now the two biggest performance-boat companies are together.

It sounds like the manufacturing of both lines will move to North Carolina. Any chance Baja's manufacturing will remain in Bucyrus, Ohio?

There's a chance. Those people up there in Ohio are making us some proposals. They don't want to lose 285 jobs. But the people down here are making better proposals. The people in Ohio need to make a better deal than I'm getting here, because if it's a draw, I'm going to take it here. It's going to be less expensive to be here than in Ohio. Also, if I'm here, we can test every Baja built, just like we test every Fountain built.

You said earlier that you wouldn't have to expand your facility in Washington to build the Baja line.

Yeah, I'm OK there. I can put more people on the assembly lines if we need them, and I have enough space here to build Baja boats without expanding the plant. The only real 'bottleneck,' if you want to call it that, is in lamination and I can add a second shift, as I said, without having to add another building.

It's a tough business and a tough world out there today. If you look back to when I started, Formula is the only high-performance boat company, other than Fountain, that hasn't gone through an ownership change or bankruptcy. I'm creating two boat companies with enough business to keep one boat company busy at one time, without increasing my overhead. Brunswick is the largest boat company in the world, and they're cutting overhead every day and closing plants.

If we max out on production and can sustain it, well, I have 100 acres here and we're only using 25 acres of it. I could add 140,000 square feet right now, but I don't want to do that. I'm spreading overhead.

What will you do to position the Fountain and Baja lines separately?

The same way that General Motors positions Cadillac and Chevrolet, with Chevy as Baja and Caddy as my boat. The Baja will probably be less expensive than the Fountain.

There's nothing wrong with the way Baja has built its boats and is currently building its boats. I want to make that clear. But we're going to build them like Fountains. We're going to change their lamination schedules and stringers, we'll use foam coring instead of balsa.

We'll make less margin on Baja, but we'll be able to keep the cost down because we're building both Bajas and Fountains the same way. It's less expensive for us to build them the same way on the same line in the same plant.

Bajas will be built like Fountains, but they will still look like Bajas. We won't add pads or steps to Baja hulls—that would be too expensive.

Will you keep the entire Baja sport-boat line, from 20 to 40 feet intact?

Absolutely. We've already been getting calls from Baja dealers. "Are you going to call them Fountains?" No. "How are they going to look?" The same as they do now, though maybe the colors will be more conservative. "How are they going to be built?" Just like Fountains.

This acquisition comes at a time when the marine industry on a whole is down. Does the timing of the deal concern you?

It's ideal in a way. If you were me, if you were out there building boats and spending more than anyone else to keep your orders up, would you see this as a positive or a negative?

Baja was the second-largest sport-boat company in the world, and Brunswick, our long-term partner, said, "Why don't you take it and build them?" They made us a very attractive offer. They didn't say give us all the money in your pocket.

If I build half of the Bajas and half of the Fountains built in the best of times, I'll still be building more boats than I ever have. The amount of money I'll need to tie up in working capital for this is low, say about $1 million. We can handle that.

How will the Baja warranty situation work in the transition?

Brunswick, through Sea Ray I think, will pick up all of the warranty work on Bajas that Brunswick built. We will pick up all of the warranty work on the Bajas we build. If Brunswick gets too busy and can't handle it, they'll contract with us and we will.

So with all you've got going on, when are we going to see you back in a race boat?

When I want to go 200 mph. But right now, I'm pretty busy.

—Matt Trulio is a freelance writer for Powerboat magazine.