Dometic, which dominates the RV and marine spaces, reported $447 million in net sales for the fourth quarter of 2024. Its products are sold in 100 countries, and it employs nearly 8,000 people.
The products Dometic produces for the marine industry include climate control, water desalination and purification systems, sanitation systems; water heaters; coolers; refrigerators; and a range of power and control systems, such as electric, hydraulic and mechanical steering; shift and throttle controls; joystick control systems; autopilots; digital switching technology; trim tabs; and outboard jackplates.
Soundings Trade Only met up with Eric Fetchko, who has been president of Dometic Marine Global for almost five years, at the Miami International Boat Show in February. He discussed his background, the company’s entry into the gyrostablizer segment, economic headwinds, acquisition strategy and more. This interview has been lightly edited for clarity and length.
Tell us about your background and how you started in the marine industry. I know you were fishing, hunting and boating early in your life.
I grew up on Vancouver Island, and I was the youngest of eight kids. We hunted and fished a lot. That’s what got me started in marine engineering, because I remember as a kid, it was such a struggle getting out on that boat. It was 50/50 whether we’d get out when we went down the dock. Is the motor going to start? The switches never worked. The gauges never worked. Fuel senders, forget that. So I always had a desire to make it a more easy process. Boating shouldn’t be that hard. It’s getting better, but it can be hard.
Did you start at SeaStar right out of college?
I had one year there. I designed bandsaw equipment. Then I got the job at Teleflex and I thought, I’m coming in for two years and I’m out. But we all know what happened there. I started as a junior engineer, became engineering manager, director of engineering, ran my own business unit, then became CTO, went back and ran our biggest facility, in Vancouver, for 11 years, and then I took over as president when my CEO retired.
Dometic made a big announcement in Miami with a new gyrostabilizer. When did you begin thinking about this product?
There were areas where we crossed into the boundaries of some of our biggest customers — engine manufacturers, for instance. So we had to ask: How can we move away, become less of a competitor to our big customers, and substantially grow our business?
There were a couple of gyro companies we tried to buy. It didn’t work out. So four years ago now, we put a couple of engineers on it, and they started doing research. They started talking to dealers. They looked at the Hull Truth and started reading stuff, learning stuff. These young guys can just pull data off the web like you wouldn’t believe.
And so we did 18 months of research, and said, OK, this is what’s good, this is what’s bad. Two and a half years ago, we made the decision, and in earnest we started developing. We started with a more, what shall I say, aggressive technology. But we realized the technology was before its time. So we switched gears and continued to develop. We figured out ways around how to find solutions for some of these things.
The third reason we did it, after growing the company and not competing with our customers, is it’s something that can be super complementary to the other products we make. The culmination of these four years to me was the launch this week. And that’s what is going to make me sleep pretty well tonight.
What are the advantages of the Dometic gyrostabilizer versus competitors?
The first obvious one, we’ve all talked about electrification on boats. The single biggest power draw on a boat is air conditioning. A gyro is another big sucker. So to the point, most of them have to have a genset on to keep them running for any length of time if they don’t run the engines. So one benefit is 40% less power draw.
The other thing that we found was a huge, huge complaint from people was a lot of times, they wouldn’t use their gyro because it took an hour to ramp them up. They just wanted to go out, bug around for an hour and then come back. And their gyro was no use to them. So we addressed that.
We ramp up to full stabilization in 16½ minutes. The other thing was ramp down. They take six to eight hours. They just let it slow down on itself. We do it in 16½ minutes.
How did you do that?
With heat gradients in the bearings between the inner and outer race, if they sped up how fast the current ones on the market ramped up or slowed it down, it could explode their bearings because the differential can only be a few degrees between the inner race and the outer race. As the tolerances are so tight, you’d explode the ceramic balls. We got around that with our cooling methods.
The other thing is, we made trim tabs and tied them into Optimus steering, and we call it our adaptive trim tabs. It’s fantastic because you’re steering around, and the trim tabs work automatically. One of the problems we found with gyros is that if you try and turn when that gyro is on, the gyro is going to fight you, and it’s going to want to stop because of its systems. If your boat’s trying to go into a turn, it’s going to want to pull you back the other way. In our system, we have a nine-axis-rate gyro. And essentially what happens is when it senses a steering load, it backs off on the gyro. Ours is the only one that can do that right now.
What else? Maintenance. At the end of the day, it’s a three-year, 3,000-hour warranty. There’s no inspection of bearings. Part of the reason our bearings last three times longer is because of clever design. We run at half the speed that others do, but we still get as good or better stabilizing forces. The lack of maintenance and lower cost of ownership is the other big thing.
In the future, do you want to build bigger systems, or do you want to go down in size?
We have some models underway. We will be coming out with bigger models. What everyone did out there is, they just scaled everything down for the lower boats. We are of the opinion that it’s a different buyer on the bigger boats than it is on the lower boats.
We think that there’s going to be some significant differences in the smaller gyros than the big gyros. The big gyros, it’s just phase up, and it works well. Your added cost is absorbed by the size of the boat and the purchase. And if you take a look at how much the gyro costs as a percentage of the boat, it gets sort of less as you go up. So that model works.
Are there any other future markets you can talk about?
Yes, we have done other things. We signed a joint venture agreement, or partnership agreement, with CMC that makes electric fin stabilizers in Europe. Last September, we integrated our Optimus steering with fins. So as you’re steering, the fins do just like what we’re doing with the trim tabs.
Dynamic stabilization needs are broad. There are trim tabs. There are active things like Seakeeper Ride. There are fin stabilizers and how they all interact. Bow thrusters. We’ve looked at the whole gamut of stabilization, and we’ve got a road map. We know where we’re going, and this time next year I’ll be able to show you some more good stuff.
Three years ago, your company melded a lot of your parts and accessories into Sierra. Was that a good move?
It was a very good move because that’s been a very successful part of our business, and it allowed focus and brand recognition. The head office also liked the idea to keep it Sierra, versus a Dometic brand, because now if they choose to produce other aftermarket stuff, say for RVs or something else, we now have a well-known umbrella to put it under. So yes, I think it was a really good move.
For everybody, 2024 was challenging. Are you optimistic for 2025? Cautious?
Cautious. I was optimistic because the last two years have been quite rough for aftermarket, because of the Covid hangover. Everyone was full of inventory. No one’s buying. They had to drain down their inventory. Boating OEM went off the planet about 18 months ago, June of 2023. The National Marine Manufacturers Association has talked about a 5% increase, all coming in the second half of 2025. First two quarters will be tough.
How is the supply chain? During Covid, a lot of companies learned to adapt. How do things look right now?
Well, it’s getting better, but here’s the $64 million question: Is it getting better because you quit ordering as much and allowed them to quasi-catch up, and as soon as things get crazy again, will suppliers start stumbling?
What we’ve been doing is proactively working with our suppliers to make sure that they put processes in place so that if we have to ramp up for some big increase, we’re not going to get hurt. If there’s an event like Covid again or similar, we’re not going to get hurt.
The other issue is Covid changed a lot of things, too. The biggest thing I hear boatbuilders say now is that boats are too expensive for the consumers. We have to cut the cost of boats. And you go back to a supplier and say, look, aluminum’s come down, stainless steel’s come down. Yes, but processing costs are up. So not very many of the suppliers have lowered the cost that they increased during Covid. So that’s a battle. We’ll see where that goes, but the supply chain has affected that a lot.
Dometic also has a big footprint in RVs. Are there marine products that you can share with the RV side and vice versa?
Yes, there are a few things. Breathe is a classic example. It cleans the air that can directly go to both. We developed it, and we sell it into the marine market, and we can sell it now into the RV market.
Things like air conditioning and heaters, they’re different animals. They could look identical, but the preparation work you have to put in place for that to go into a marine environment versus on top of an RV is spectacular. So I would say there’s lots of opportunity, and indeed we do share technology among products.
How are generator replacement and digital switching going for you? Do you still see them growing?
I do see it growing. It was a tough call with our boat-in-a-box and our digital switching and all that, because when you go digital from analog, it’s a cost up. You get more features, you get more benefits, but it’s still a cost up. So our approach was to teach the boatbuilders how our digital stuff actually made them able to build a boat faster. We had some boatbuilders that could build three extra boats a month. I’ll pull a number, say $250,000 each, on the same fixed overhead and the same labor because the way we have designed the digital switching, it takes so much work out of it. When you’re installing it in the boat, that’s huge for a boat company. So when they say, I can get three more boats out at the same cost and the profits are gravy at that point, that really helped some builders.
Secondly, this product is a pull system for our mobile power systems, for our lithium batteries, our chargers, and AC/DC converters. Because at the end of the day, a lot of guys are using this because of the low power drop, and they’re not putting gensets on their boats. When you get to the bigger ones, you’re never going to do without a genset, but maybe you can go to a smaller size. But on the smaller boats, the 36 Regulator for instance, no genset. They use our lithium batteries, and every time we sell one of those, it’s a win for us. So, it’s still an immature market. Our battery manufacturing is starting to come online because it’s a special battery. Once we get there, it’s going on a steady curve. So I’m really positive on that part of the business.
In your Vancouver facility, what is your employee footprint in manufacturing?
It’s 200,000 square feet when things are going full bore. That’s 550 employees, roughly 75 design engineers, probably 16 manufacturing engineers, eight quality engineers. We have 48 CNC machines. We have robotic assembly, robotic welding and robotic packaging. We have robotic precision motor winding, and we have robots that actually pick up the product after it’s all assembled on the bench, put it in a box and then put it in shipping boxes to stop repetitive injuries. So it’s a pretty impressive place.
What emerging markets in the marine industry are you excited about?
Right now, probably my biggest thing I’m excited about is our mobile power solutions, because the world has accepted the fact that we need to electrify boat propulsion, though electric propulsion will remain a niche for quite some time. Maybe someone will come up with a solid-state battery that allows longer ranges than now, but it’s going to be a niche, and we’re paying attention to it. But with the number of batteries used for things like gyros, air conditioning, refrigeration — because people want their cold drink, but they don’t want their engines running, they don’t want a genset — that’s what makes a great model for this. So I’m most excited about stabilization for comfort and mobile power systems.
What are your thoughts on integrating steering components, trim tabs and other control features with autonomous boating?
It’s funny. We’ve been down that path. We had vision systems with artificial intelligence seven years ago, and at that time we decided that the engine manufacturers owned the control algorithms, the parameter group numbers and the motor. Those are really big parts of autonomy. So we decided to leave it to someone else. We supply systems for many of them, and they integrate our technology into their systems, but at the end of the day, we chose to stay away from it.
You have to consider that autonomous cars have all sorts of sensors, radars and things like that, but the weather doesn’t interfere as much. There are more consistencies than when you’re out on the water, which has many variables. It can be wind at the side of a boat, making a tall boat act like a sail. It can be currents and waves. So many unpredictable elements are involved. A lot of people got something to work, but for it to function reliably, I think we still have a way to go.
