Brunswick to consolidate production

Posted on Written by Michael LaBella

Brunswick Corp. is suspending yacht production at its Sykes Creek facility in Merritt Island, Fla., and will consolidate its yacht and motoryacht production at its Palm Coast, Fla., plant.

“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 CEO Dusty McCoy said in a statement.

Production will end in June at Sykes Creek, where about 205 people build Sea Ray and Meridian models from 51 to 61 feet. The company is evaluating job opportunities for Sykes Creek personnel to help transition production to Palm Coast or at other Brunswick Boat Group manufacturing facilities for employees who are interested and able to relocate or commute, the company announced.

The Brunswick Boat Group’s 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 on the Merritt Island campus.

“This action allows us to reduce production costs and shorten production cycle times of yachts,” Brunswick Boat Group president Andy Graves said in a statement. “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 presale 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 motoryachts.”

When the entire consolidation is completed, the company estimates annual savings of between $3 million and $5 million, beginning in 2014. Restructuring and impairment charges of between $6 million and $8 million are expected to be recognized as a result of this action in 2013.

Click here for the complete release.

Check Wednesday’s Trade Only Today for an exclusive interview with Graves.

Comments

6 comments on “Brunswick to consolidate production

  1. RichardS

    The continued contraction and demise of a once iconic and thriving boat company. Connie Ray, Jerry Michalak and many other are probably turning in their graves right about now. Very sad!

  2. BayBoater

    “This action allows us to reduce production costs and shorten production cycle times of yachts,” Brunswick Boat Group president Andy Graves said in a statement. “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 presale of the new yacht models under development.

    That’s funny. That statement is used almost word-for-word for when they want to tell their shareholders that they are spending money to open a factory, too! LOL Does Dusty and company really think their shareholders are that stupid???

    Apparently so…

  3. TIDE ferrari racing, palm beach,rebecca cummings.

    Hope this is not the beginning of a move to China three years later when the business gifts from the state of Florida expire. They need to upgrade the quality of most of their boats from a safety point. TIDE ferrari racing, palm beach.

  4. JOHN ENNIS

    JUST A FEW WEEKS AGO THIS POOR EXCUSE FOR THE BOATING MANUFACTURY BUSINESS WAS SAYING HOW GREAT EVERYTHING IS. NOW THAT WALL SATREET HAS SWALLOWED THAT CRAP COMES THE TRUTH AND THE LAYOFFS . SMALL WONDER THE NAME BRUSWICK MAKES MANY PEOPLE IN THE BOATING TRADE PUKE.

  5. Interested Observer

    Wow -Shows how tough that 50′ plus market is. especially for Meridian and Sea Ray. Both of those Boat Brands in that 50′ plus market were making Brunswick 5 million a WEEK back in the mid 90′s thru 07. Now the remnants will be shipped up to the Brunswick Graveyard in Palm Coast, to save 3 mil a YEAR! I mean how else can Brunswick consolidate all Bayliner(Meridian) yachts from 3 very large plants, plus the Merritt Island plant and now Sykes Creek to a plant that at 1 time only built Sea Rays between 45 and 48 because that’s all the plant could accomadate. They will have to open up more storage for all the molds they will be adding.
    America needs $1./gallon fuel to see the glory days in the Marine Industry again!!

  6. larry Russo, Sr. Russo Marine

    Why all the bashing about how Brunswick has ruined the Sea Ray brand? They are only adjusting and reacting to challenging, marketplace realities. Its not like this brand is loosing major share in the sport yacht and yacht categories. The whole segment is down, not just this brand. Go look at the SSI data on their competitors in comparable size ranges. In the 36 to 62 ft. category, Sea Ray and Meridian have a 29% share. They produced nearly 300 units in 2012. Their closest two competitors produced only 60 and 50 respectively. Its a dark time for the cruiser segment but its simply not Brunswick’s fault.

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