Local boat maker adapts to market to avoid Sea Ray's fate

Local boat maker adapts to market to avoid Sea Ray's fate

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MasterCraft has also been making changes to adapt to the new boat marketplace. MasterCraft has also been making changes to adapt to the new boat marketplace.
"Boats, in general, are a luxury item. Nobody really needs them. It's a purely discretionary item," said McNew. "Boats, in general, are a luxury item. Nobody really needs them. It's a purely discretionary item," said McNew.

By HAYLEY HARMON
6 News Anchor/Reporter

VONORE (WATE) - After boat maker Sea Ray announced it would shutter its Knoxville plant and lay off 225 workers, other boat manufacturers say they have also seen their sales slip.

The boat manufacturer produces cruisers and other large boats.

Sea Ray owner Brunswick Corporation said the still-sluggish economy led to a decrease in demand for larger boats by consumers, prompting the closure.

MasterCraft boats are also made in East Tennessee at a plant in Vonore.

MasterCraft President and CEO Terry McNew said every brand saw boat sales dip during the recent economic slowdown.

"We started seeing it in the boat industry really in 2006. Everybody did. It accelerated, of course, in 2008," said McNew.

Families trying to cut back tend to spend on the things they need, and oftentimes, that's not a new boat.

"Boats, in general, are a luxury item. Nobody really needs them. It's a purely discretionary item," said McNew.

McNew was an executive vice president with Brunswick until August of this year. He said the market for larger boats made at the Knoxville plant had been dwindling for some time.

"That market has been declining significantly over the last 5 years," he said.

They once made 40 boats a week. But because demand has been down, Sea Ray's Knoxville plant had been down to making just 11 per week in recent months.

MasterCraft hasn't seen as big of a decline in demand.

McNew said that's due, in part, to the fact that the company caters to a more affluent clientele.

"Buyers really know what they want and are dedicated to that product in a more consistent way than some other casual boaters might be," he said.

MasterCraft has also been making changes to adapt to the new boat marketplace.

Across the board for all boat manufacturers, they have to stay on top of what the consumers want. They do intensive market research to find out what boat buyers are looking for in a product.

As a result of that research, they can better focus on making the exact boats their customers want and will buy.

"We've streamlined the operations. We've reduced our cycle time in manufacturing and product development and engineering and managed to keep our costs down and that's a big focus for us going forward," said McNew.

MasterCraft said they are open to hiring any Sea Ray employee who is looking for a new job, depending on availability.

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