Bowling
Brunswick to Move Bowling Ball Production From Muskegon; Keep Sales and Support Staff at Site
LAKE FOREST, Ill., June 16, 2005 /PRNewswire-FirstCall via COMTEX/ -- Brunswick Corporation
(NYSE: BC) announced today it will begin moving its bowling ball production
from Muskegon, Mich., to Reynosa, Mexico, over the next 12 to 24 months. The
company cited its inability to be competitive in the global marketplace,
despite numerous cost-cutting efforts at the Muskegon plant, as the reason
behind the decision.
During the next two years, approximately 115 production positions will be
phased out at Muskegon as the company migrates production to the yet to be
completed new plant. Brunswick Bowling's sales and support functions, which
comprise the majority of the Muskegon operations with approximately 275
positions, will remain in Michigan.
The decision was announced following a recent round of meetings with the
union representing employees in the ball plant production and distribution
areas.
"Brunswick's commitment to Muskegon remains strong, despite this latest
and most difficult decision," said George W. Buckley, chairman and chief
executive officer for Brunswick. "As Brunswick continues to sell, source and
manufacture products around the world, Muskegon will remain an integral part
of our bowling operations. It will remain home for our bowling products
operation's key functions such as sales, marketing, research and development,
distribution and supply chain management, ensuring that Brunswick maintains
its competitive edge and leadership position in an increasingly competitive
global market."
"For some time now, we have had a sustained and concerted effort to reduce
costs at Muskegon, our only ball production facility, and throughout our
bowling products group," Buckley said. "While these efforts have produced
savings, the current cost structure in our bowling ball production operations
remains too high, and there appears to be insufficient opportunity to gain
significant new cost savings in material purchases or productivity
improvements alone. We need to fundamentally alter our cost structure if the
bowling ball business is to remain viable."
"After discussions with union representatives, we have found that little
more can be done to mitigate the relatively high labor costs of the current
manufacturing operation, when compared with an operation in Mexico," Buckley
continued. "Our ball production costs in Muskegon are higher than what our
competitors pay, and the cost difference between the current and future sites
of ball production is substantial."
"This was still a very difficult decision to make, particularly in light
of the fact that we have had production at this facility for many decades,"
explained Buckley. "We did so, however, after exhausting every avenue and
concluding that there were no other truly viable options to sufficiently
reduce manufacturing costs and restore our cost competitiveness."
"We decided to make the announcement now, to give our employees the
earliest possible notice of our decision as well as ample time to prepare for
their transition to other employment," Buckley explained. "We will be
discussing the transitional assistance package with union leadership as soon
as possible."
During the transition, certain manufacturing equipment will be moved to
the Reynosa facility, while the Muskegon operation turns its focus to sales,
support and product development.
Brunswick said that estimated transition costs of approximately $7 million
will be incurred over the next two years and will not materially affect its
overall financial performance for 2005. The move will save the company
between $5 million and $6 million annually once the transition is complete in
2007.
About Brunswick
Headquartered in Lake Forest, Ill., Brunswick Corporation endeavors to
instill "Genuine Ingenuity"(TM) in all its leading consumer brands, including
Mercury and Mariner outboard engines; Mercury MerCruiser sterndrives and
inboard engines; MotorGuide trolling motors; Teignbridge propellers; MotoTron
electronic controls; Northstar marine electronics; Navman marine and GPS-based
products; IDS dealer management systems; Albemarle, Arvor, Baja, Bayliner,
Bermuda, Boston Whaler, Crestliner, Hatteras, Lowe, Lund, Maxum, Meridian,
Ornvik, Palmetto, Princecraft, Quicksilver, Savage, Sea Boss, Sea Pro, Sea
Ray, Sealine, Triton, Trophy and Uttern boats; Attwood marine parts and
accessories; Land 'N' Sea marine parts and accessories distributor; Life
Fitness, Hammer Strength and ParaBody fitness equipment; Brunswick bowling
centers, equipment and consumer products; Brunswick billiards tables; and
Valley-Dynamo pool, Air Hockey and foosball tables. For more information,
visit http://www.brunswick.com .
SOURCE Brunswick Corporation
Dan Kubera, Director -- Public and Financial Relations, of Brunswick Corporation,
1-847-735-4617
http://www.prnewswire.com
