NO.1 STORY
OF 2008?
DO YOU HAVE TO ASK?
The worst economy in decades has already reconfigured
the marine landscape during a turbulent year
The new year is the time those of us in the news business look back on the previous
year’s events and reflect on which had the biggest impact. Unfortunately, choosing the
No. 1 story of 2008 from a marine industry perspective wasn’t all that difficult. In the
words former Clinton political strategist James Carville used to define the 1992 presidential
campaign, “It’s the economy, stupid!” In fact, we were hard-pressed to find stories in our top
10 that weren’t related to the economy — either as contributing to the downward spiral or re-
sulting from it. Here is the list, as chosen by the editors and writers of Soundings Trade Only.
By Beth Rosenberg / Staff Writer
b.rosenberg@tradeonlytoday.com
1.dominated headlines in the boating industry
and in every other facet of life in the United
The Economy — In 2008, the economy
States. The Dow Jones Industrial Average dropped
more than 4,400 points, or 33. 8 percent — its biggest
decline since 1931. About $7 trillion of shareholders’
wealth was wiped out. Marine-related stocks were hit
hard. Brunswick Corp., for example, was trading at
$19.63 a share last February, and at the beginning of
2009 was at $5.20. That was up from its 52-week low
of $1.82, which it hit in November.
Many industry leaders say the economy was the
worst they’d seen in their careers. “I have been an investment banker and a chief executive for over 20
years, but I have never seen the turbulence that we’re
experiencing right now,” Ceasar Anquillare, CEO of
Winchester Capital and chairman of WinMarine Ventures, told Trade Only in September.
Time will tell whether the effects of the $700 billion bailout plan approved by Congress will trickle
down to the boating industry. Rising unemployment,
a prolonged housing slump and a credit squeeze continue to affect boat sales as 2009 begins.
2.May, the country’s largest boat manufacturer
announced it was ceasing production of its
Shakeup at Brunswick Corp. — In mid-
Bluewater Marine brands — Sea Pro, Sea Boss, Palmetto and Laguna. It also announced plans to sell its
Baja line to Fountain Powerboats. Brunswick at the
time said it was moving toward a “smaller manufacturing footprint,” with more locations that can produce multiple brands and models.
NYSE; GARY BECKETT (FROM TOP)
The following month, Brunswick said it was closing
four plants in the coming year in addition to the eight
plant closures previously announced. This would
bring the total number of plants down to 17 or fewer
by 2009, and would reduce the company’s fixed-cost
structure by $300 million.
The plant closures also meant the loss of at least
1,000 hourly and salaried jobs.
Officials said savings of about $100 million were expected by the end of 2008, with the full $300 million
in savings coming by the end of 2009.
“We’re not predicting where the market is going,”
The economy wasn’t so hot leading
up to autumn of 2008 — and then
the financial meltdown came.
chairman and CEO Dustan McCoy says.
“What we’re doing is sizing ourselves so
no matter what happens with the market,
we’ll be able to be profitable.”
3.— Last year saw a number of financial institutions drop out of ma-
Tightening of the credit market
rine lending, both on the retail and wholesale sides. In June, GE Money exited retail
lending. Citizens Bank of Rhode Island announced in August it was pulling out of
the marine market. And in late September,
KeyBank announced it was getting out of
both retail and wholesale marine finance.
In December, Textron, one of the top
five wholesale lenders, said it was exiting
floorplan financing.
Gasoline prices topped $5 per gallon over the summer — the
height of the boating season — then plummeted nearly $3,
leaving both industry professionals and consumers wondering
where prices go next.
4.season, gasoline reached record highs of
more than $4 a gallon on the highways and
Fuel prices — At the height of the boating
more than $5 a gallon at some marinas, especially in
coastal markets. Although people were still using
their boats, most seemed to be taking shorter trips
or staying on board at the dock.
