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October 5, 2007
Knoxville-based Sea Ray Boats will lay off 185 workers at plants in East Tennessee, Florida and Ohio because of a continued weak market, the company announced Thursday.
The layoffs amount to about 5 percent of the company’s work force, a press release said.
A total of 80 positions will be eliminated at the company’s three East Tennessee manufacturing plants — two in Knox County and one in Vonore. About 55 jobs are being cut at the company’s Florida plants and about 40 in Ohio.
Sea Ray, a unit of Brunswick Corp., also will shut down its plants during the week of Thanksgiving to reduce costs.
Brunswick spokesman Dan Kubera said the company would have no other comment beyond what is in its press release.
This is the second round of job cuts by Sea Ray in less than three months. The company, which has struggled with soft sales for months, laid off about 90 East Tennessee workers in early August.
Sea Ray employs about 1,800 people at its three East Tennessee plants. The company also has four plants in Florida. Its Baja Boats are manufactured in Ohio.
Brunswick Chairman and CEO Dusty McCoy has been saying for months that boat sales were suffering.
On July 20, he told investors that this year was shaping up to be the worst for boat sales since 1965. It also was announced then that Brunswick was lowering production in the second half of 2007.
In the press release issued after the close of business Thursday, Brunswick said the layoffs are the result of a “continued weakness in the marine market” and the company “must take measures to size its costs in line with the declining market.”
The release also said that although the domestic marine industry “has seen a double-digit drop in demand over the past year in a progressively challenging sales environment, Sea Ray has increased its U.S. market share. However, economic pressures continue to reduce consumers’ spending power and new boat purchases are being adversely impacted.”
The news release said impacted employees will receive help “in transitioning to other employment,” but it provided no details.
Not all area boat builders are suffering. In July, East Tennessee-based MasterCraft Boat Co. said for the sixth straight year it had record gains in revenue and boats sold. MasterCraft attributed the gains for the fiscal year ended June 30 in part to a strong showing at boat shows and “aggressive” introductions of new models.
East Tennessee has become a haven for boat manufacturers that employ more than 4,000 people.
In the multistate Tennessee Valley, boat building employs about 6,300 workers who earn an average annual wage of $43,600, according to TVA estimates. And nearly 4,200 of those employees are in East Tennessee.
Last year, Christensen Shipyards Ltd. announced that it would build large yachts at a new plant in Loudon County near Greenback. The area around Tellico Lake has attracted other boat manufacturers, including, Sea Ray, Cobalt Yachts, Skiers Choice, Allison Boats and Tennessee Watercraft.
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