PACIFIC SEACRAFT MOVES EAST p. 8
® INSIDE: Many
recreational
boating waterways are developing shoaling
hazards, and
dredging money
is virtually
nonexistent.
p. 24
THE BOATING BUSINESS NEWSPAPER VOL. XLV, NO. 5 NOVEMBER 2007
$5.00
www.tradeonlytoday.com
A make-or-break year looms for some dealers
If things don’t pick up, weaker retailers and even manufacturers could face bankruptcy
By Gary Beckett
There may be light at the end of the tunnel — but
it’s faint and no one in the recreational marine industry is quite sure if the glow signals the beginning of a
turn-around, or just a pause in what has been an ever-weakening market.
With model year 2008 now under way, marine
dealers have weathered two of the worst down years
since the epic industry depression of the early 1990s.
Thus far, most have taken the storm fairly well. Un-
like the bleak days of 1991
through 1993, there have been
no reports of widespread dealer
bankruptcies or of lenders auctioning off truckloads of repossessed dealer inventories.
3rd quarter
is looking
a bit better.
p. 62
Those who watch the market
closely say retailers, by and large,
have done a decent job of whittling away inventories
and reducing operating costs. But if the downturn extends into a third year, the carnage of dealer and even
manufacturer bankruptcies that were all too common
in the early ’90s could return.
Manufacturer-to-dealer sales of marine products declined by about 10 percent in MY2007 after falling 6
percent in 2006, according to Thom Dammrich, president of the National Marine Manufacturers Association. At the retail level, declines in certain parts of the
country have been worse. “I’ve talked to dealers who
are in areas that are down as much as 20 to even 40
percent,” said Phil Keeter, president of the Marine Re-
continued on Page 12
Hunter getting ready
to certify used boats
A BUSTLING IBEX
The October IBEX was “bigger and better,” filling all four halls
of the Miami Beach Convention Center in October. p. 10
By JoAnn W. Goddard / Associate Editor
j.goddard@tradeonlytoday.com
Following the automotive industry’s lead,
Hunter Sailboats in September announced a new
program to certify and warrant used Hunter models up to seven years old.
“It will be a huge shot in the arm to dealers,”
said Eric Macklin, Hunter’s marketing and training manager.
While new-boat sales have been soft, used and
brokerage sales in many areas have been strong. In
addition, used boats continue to appear as the
gateway to the boating lifestyle, according to the
National Marine Manufacturers Association. Consumers get a taste of the boating life, without
spending as much as they would on a new boat.
Then they are generally ready to move up to a
new, and often bigger, boat.
According to the NMMA’s latest statistics,
more than 1 million used powerboats were sold
in 2006, totaling $12.3 billion in sales and accounting for 72 percent of all boats sold. That is
a 1-percent increase from the previous year. The
trade group did not break out the number of
used sailboats sold, but of all used-boat sales in
2006, 2 percent were sailboats.
continued on Page 43
No recession – but no relief
Marine lenders told economy will grow, boat sales may not
By Greg Proteau
Trying to interpret whether a slowing general economy is pausing to refresh or retreat was a key question
facing the nation’s marine lenders at a gathering in
early October.
Speaking at the annual conference of the National
Marine Bankers Association in Jacksonville, Fla., Wachovia Bank economist Mark Vitner said that despite
its problems, the nation is nowhere near recession.
Rather, he said, the economy is in a midterm correction of a near six-year expansion.
Vitner said, however, he sees no quick relief from the
slump in new-boat sales. Fuel costs, he said, will keep
an anchor on that market for the short term, at least.
As far as the sub-prime lending situation, Vitner said
the “structured finance markets” where sub-prime activity takes place need to work out the problems.
Turning to housing in general, Vitner said sales peaked
two years ago, and he thinks the market bottom is
near or will come in 2008. Meanwhile, home values
(and thus home equity) will continue to drop in many
markets, he said, but he thinks other positives will
continued on Page 40
Selling accessories:
It can be profitable, but it’s also
extremely competitive. p. 18
The ads
are working
The numbers
show the Discover
Boating campaign
has people thinking
about boats. p. 36
