happened to mine too
My 96 GTX Seadoo sank because of the carbon ring as well. Seems like a pretty poor design to me. If that thing is slightly out of alignment the water will pour in. I figured they changed the design by now but I guess not.
Mine was a 2 stroke and did not submerge the electronics so I just got the water out of the engine and it was fine. Never did trust that ring again overnight.
If they don't give you a new engine maybe you can get an extended warranty for 4-5 years from Sea Doo.
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