Military and industrial aluminum boat manufacturer SeaArk Marine, Inc. of Monticello announced that it will temporarily suspend acceptance of new boat orders until further notice.
The company said that "very sporadic and extremely low (new construction) sales figures for nearly 24 straight months" contributed to the decision.
SeaArk Marine said it will begin "an overhead reduction plan in an attempt to ‘ride out’ the effects of the current market until substantial improvement in the government & industrial marine sector appeared more apparent."
Company officials emphasized that they are not completely shutting down operations. It will continue construction on several orders and fulfill spare parts orders indefinitely.
“Obviously, this is a very emotional decision for everyone concerned” said John McClendon, President and CEO of the company. “We have recently worked our way down to the minimum amount of fixed overhead we could and still properly serve the market that we compete in. Typical construction time for our products can be fairly long — up to a year or more for some of the larger vessels. This means that very small contracts and ones that continue to be stretched far apart have the potential to keep pushing cash consumption further and further out, eventually beyond financially sound limits.”
McClendon said that SeaArk is in a "positive cash position" and has no debt.
“We wanted to be able to continue that position and control those elements long before it became any sort of crisis to manage. Company ownership has struggled with this decision for some time, but this sales downturn is the most severe experienced in the company’s 52-year history, and despite our sales team’s monumental efforts, the increasing uncertainty of various opportunities developing recently created serious doubts that it will reverse significantly within the next year,” McClendon said.
SeaArk Marine Inc., formerly MonArk Boat Co., has been in continuous operation in Monticello since 1959. Currently, it employs 60 workers.