MERRITT ISLAND, Florida -- Sea Ray Boat's parent company, Brunswick
Corporation, announced yesterday that it will consolidate its
yacht and motor yacht production at its Palm Coast, Fla., manufacturing
plant. As a result, Brunswick will suspend manufacturing at its Sykes
Creek boat manufacturing facility in nearby Merritt Island, Fla., at the
end of June.
The Brunswick Boat Group's (BBG) Product Development and
Engineering center, located adjacent to the Sykes Creek plant, will
remain in operation. In addition, BBG will continue to utilize the
existing customer reception facilities, sales and customer service
offices, and wet slips located on the Merritt Island campus.
The
Sykes Creek plant, which currently manufactures Sea Ray and Meridian
yachts and motor yachts from 51 to 61 feet in length, currently employs
approximately 205 people in manufacturing. The Company is evaluating job
opportunities for Sykes Creek personnel to help transition production
to Palm Coast or at other BBG manufacturing facilities for those
employees who are interested and able to relocate or commute.
"This
action allows us to reduce production costs and shorten production
cycle times of yachts. Further, the transition is planned so that we
can take full advantage of initial retail demand for our new yacht
models that we are bringing to the marketplace over the next two years.
Concurrent with the transition, comprehensive marketing materials will
be provided to our dealer network to support the pre-sale of the new
yacht models under development. We can still support significant sales
growth in these segments, as our post-consolidation manufacturing
footprint will retain capacity to compete in a market in excess of 2.5
times current worldwide demand for yachts and motor yachts," said BBG
President Andy Graves.
"Difficult as it was, this
action was a necessary step to match capacity with market demand,
position Sea Ray for success with new yacht product development
programs, and work toward our near-term operational and financial
objectives," Brunswick Chairman and Chief Executive Officer Dusty McCoy
said.
When the entire consolidation is
completed, the Company estimates that this action will result in annual
savings of $3 million - $5 million beginning in 2014. Restructuring and
impairment charges of $6 million - $8 million are expected to be
recognized as a result of this action in 2013.
