yes you definitely need a new speaker. what is your engine mth item number I susect it is a ps2 5 volt board, if so you need a new 16 ohm 5 watt speaker, Don't keep using your engine as magnet is failing and if the magnet metal pieces that are coming loose get inside the voice coil and short it to ground you will burn out the audio amp inside the electronic. that is a normal issue you sometimes get when the engines get older, just replace the speaker and ill bet your sound will return and work normal again!
Alan