NEXUS: THE TAX MAN’S NASTY SURPRISE p. 25

®

INSIDE: Shanda Lear-Baylor of the Learjet family and her husband, Terry Baylor, have turned their focus to electric boats. p. 39

THE BOATING BUSINESS NEWSPAPER VOL. XLIV, NO. ¹⁰ APRIL 2007 $5.00 www.tradeonlytoday.com
Boat repossessions on rise in Rust Belt

Midwest’s bleak employment picture blamed for a decline in sales and a jump in loan defaults

By Reagan Haynes

The Midwestern economy — burnt by the big three American automak-ers, Pfizer’s closing of its Michigan plant with its layoff of thousands and Comerica’s move from the Detroit area to Dallas — has taken its toll on the marine industry.

Drooping boat sales and the lackluster turnout at the Detroit Boat Show in January reflects the sagging Midwest economy.

But a new trend has also emerged in the region where economic news has gone from bad to worse in the past several years: Boat repossession com-

panies are doing more business than ever in the Midwest.

Delinquent and charged-off boat loans have increased nationally, from about 0.75 percent in 2004 to nearly 1 percent in 2005 (2006 numbers are expected in May), according to Jim Coburn, president of the National Marine Bankers Association.

The NMBA doesn’t break down statistics by region, but at least two repossession companies that do business in the Midwest say their business has grown between 20 and 36 percent in the last year.

G. Robert Toney is president and owner of National Liquidators, which

“People need a car, they
need a house, but they
don’t need a boat.”

— Banker Jim Coburn

has offices in Newport Beach, Virginia, Fort Lauderdale and Cleveland, Ohio. The Cleveland office repossesses boats within a 500-mile radius.

“In the whole Great Lakes area, business has increased substantially in the last six to 12 months,” Toney said. “ National Liquidators handles cases nation-

wide ... and off the top of my head, the Midwest is where we’re seeing the biggest increase right now.”

The area seems “much more volatile” than the rest of the country, Toney said.

National Liquidator’s Midwest office experienced a 36-percent increase in repossessions from 2005 to 2006, according to vice president Matthew Amata.

That office covers Missouri and east, excluding Texas, and North Carolina and north, including the entire Eastern coastline. Repossession is defined as the number of boats the company successfully recovered; it does not in-

continued on Page 35

Model-year

misgivings

Boat-outboard ‘mismatches’ raise dealer-level concerns By Marianne V. Heffernan

Confusion over the elimination of model-year designations on outboard engines has created a split in the industry, driving a wedge between consumer advocates and manufacturers.

Three of five major manufacturers did away with model years on outboards within the last two years. This strategic move allows them to make new products as they are introduced, rather than waiting for a new model year. The change means those manufacturers can provide consumers with more options. But industry groups say it creates the possibility for misunderstandings that could lead to disgruntled