It emerged yesterday at the London Boat Show that Hunter Marine, a big US boat builder, is expected to use a site in Kent which will initially employ 200 to assemble yachts. It is planned to build up to a staff of 400 within five years.
Tony Beechey, chairman of the British Marine Industries Federation, said Spain had also been trying to attract the Hunter factory: "I have been working at it for a year. I think we will beat the Spanish."
Two ministers from the Department of Trade & Industry - Ian Lang, the Secretary of State, and Richard Page - visited the boat show at Earl's Court to talk to Hunter Marine about the project.
Mr Beechey said he did not know of any other foreign yacht builder that had set up a plant in the UK.
Hunter Marine markets sailing yachts under the Legend name in the UK to avoid confusion with a British boat builder called Hunter. It also makes Silverton and Mainship powerboats.
Imported Legends have been selling well in the UK but the main target of the new factory is expected to be the continental European market.
Meanwhile, the boating industry appears to be recovering even faster than the housing market, with double-digit increases in sales last year for the first time since the 1980s boom, Mr Beechey said. The increase of more than 10 per cent is thought to have taken sales above pounds 2.1bn in 1996, compared with pounds 1.9bn in 1995.
Mr Beechey said the improvement was because of the general level of confidence coming back into the economy.
He said there was no repeat of the extravagant spending on very expensive yachts seen during the 1980s, so the industry's recovery was sounder this time.