Just how bad off is the marine Industry?

[TOHATSU GURU]

Just for giggles....How bad was last year and what do you see for this year?

 

[rodbolt]

Re: Just how bad off is the marine Industry?

last year wasnt great, not so bad but next year I dont think will go well t all. unless the fish show up big time anyway.
in my area marina fuel,usully regular, is about 3.60 a gallon, makes an offshore day run between 500-800 dollars in gasoline for the average twin engine offshore hull.
had a lot of boats last summer that never got dewinterized due to fuel costs and a lot more got sold.
seems the ales of skiffs with small motors picked up but the profit mrgin on it is slim and the service work not worth doing almost. we dont make any money servicing small engines(les than 150 HP)
take the guy with the 17 skiff and a 4 stroke fifty, he is in and out in les than an hour normally, 2 if the carbs have to be gone through. later F50s are EFI from yamaha,06 and up.
its not like the service on a 33 grady marlin with a genset and twin ox66 250s or even twin F250s. one big boats its a constant battle with gensets,pumps,hull systems and upgrades to hull systems. keeps the service by busy.
ya ever try to access the remote oil tanks on a 33 grady for filter service? talk about an act of god and congress.

 

[ondarvr]

Re: Just how bad off is the marine Industry?

The boat building portion is down dramatically, 30 to 40% isn't uncommon, with some companies almost at a complete stop.

There are a couple boat styles that could still be considered strong relative to the rest of the industry, but slow is the word. 40' to 50' and longer are doing better, with the 100' to 200' doing well. Part of this may be that as the boat gets bigger, it takes much longer for the owner to take possession, so these have been in the works for a long period of time.
Many of the people that purchase these large yachts are not as affected by current market fluctuations as the rest of us. Wouldn't it be nice to be able to buy 160'er with spare change.

 

[Chris1956]

Re: Just how bad off is the marine Industry?

I will expect that the boat industry will take more hits with the price of fuel still climbing. I expect new and used boat prices will fall, and actual usage of boats drop off.

 

[Navy Jr.]

Re: Just how bad off is the marine Industry?

As one who is in the market for his first powerboat, I also have been wondering about this.

Additional consideration beyond the price of fuel is the "recession" the country's economy appears to be in. It sounds like lots of folks financed their boats and other toys using home equity loans or lines of credit based on the value of their homes before the real estate bust. Interest rates will probably go down in the near term, so those folks who can hang onto their jobs should make out okay.

But dealers hoping to sell boats based on buyers being able to tap into their homes' equity might be in for a big surprise this season. Banks are tightening their lending policies, the value of homes in many areas are actually declining, and overall consumer confidence is falling.

Perhaps those who buy the high-end stuff are not as affected as the rest of us. Those dealers would be relatively unaffected. But dealers who sell only low to mid-range boats may have a difficult year or two ahead of them.

 

[BillP]

Re: Just how bad off is the marine Industry?

One major retailer I know of was down about 30% last yr and there are no signs of it getting better, at least in Florida. The only positive part is for new boat buyers...MANY dealers here in FL are selling for cost or less just to reduce their floorplan overhead. They aren't restocking and parking lots are bare. Doors are closing too, it's getting ugly. Part of the deal is fuel cost but the stop in home construction has really put the skids on here. Those contractors spent big bucks when the cash was flowing. Now they are selling everything and trying to survive.

bp

 

[ztim]

Re: Just how bad off is the marine Industry?

A dealer told me something about some boats have to be sold with a certain type engine. A customer can't have a choice without some sort of penalty. Is that right?

 

[dingbat]

Re: Just how bad off is the marine Industry?

A dealer told me something about some boats have to be sold with a certain type engine. A customer can't have a choice without some sort of penalty. Is that right?

A boat builder will often team up with an motor manufacturer to leverage their buying power. The use of a single manufacturer cuts down on labor and inventory costs as well since they don?t have to stock parts for multiple engine configurations.

My builder onlt uses Yamaha 4 strokes but will gladly hang any motor you want but you're going to pay very dearly for it.

 

[roscoe]

Re: Just how bad off is the marine Industry?

The industry has been riding the wave of economic prosperity for 25 years.
Now that things are back to normal, everyone wants to cry recession, and "things are bad in the industry".

Thats the result of things being too good, for too long; people forget what "normal" is, and what an economy can really support.

Now, factor in that the industry has upscaled and upsized every boat product line, and made them so fancy, and less practical; all so that they can drive up the base cost of each boat.
There will now be a reversal, or correction.

They will probably learn that they should not be building $25,000 18' aluminum freshwater fishing boats that weigh in at 2800#, and drink $80 worth of fuel an hour.

The same will hold true in all segments of the market.

 

[Silvertip]

Re: Just how bad off is the marine Industry?

I'm about to find out how bad off the marine industry is. The Minneapolis Boat Show is next week and I will be trying to buy a pontoon, with or without a motor, with or without a bunk style trailer, with or without a trade of my walleye boat, and without or without my very nice 75 Merc two stroke that I won't hesitate a minute to transplant to the 'toon. There is lots of inventory to be unloaded and I intend to make off with some of it. The number of people meandering around will be the first clue. But then it's 15 below zero here this morning and there is no break forecast so that may work in my favor as well.

 

[TOHATSU GURU]

Re: Just how bad off is the marine Industry?

Here's what we have found...

07 versus 06...We were up 2% on gross receipts and down 11% on unit sales. (We had grown unit sales for the last five years.)

Since September sales have been a shadow of what they should be with unit sales down 30% from the previous years numbers. What's worrisome is that parts sales are down 60%....And that just doesn't happen by itself. We have looked into it and it's not us....Every dealer is reporting a record low winter season. Indications for January are even stranger. Unit sales are up a little, but parts/service are still at the worse level ever...Well, as low as 1989 anyway.

We only use one floor plan company and they are seeing a very high number of dealers that are having trouble meeting their commitments. I hate to say it, because it becomes a self-fulfilling philosophy, but it looks like we could see a lot of dealers fail as soon as we get through this season.

 

[Texasmark]

Re: Just how bad off is the marine Industry?

It seems that recreational products are the first to take a whack as they are the things that people don't have to have. I have felt compassion for the industry all my life, but they have survived and responded.

Having been in the appliance business for a time, I understand about floor plan costs. Gotta have enough on the floor to make the sale, for those who don't want to wait, but it costs money to do that.

Back when I was a kid, I fished fresh water and salt water. Didn't take long to realize that blue water costs money and if you don't have it you gotta fish the lakes and rivers, close to home. So, I guess there will be more of that as folks adjust to the new fuel prices. But I would prefer to be out there and the fish taste much better. Just something about natural salt flavoring. Course I live inland now and it's not convenient to go even if I could.

Other thing was I realized that a smaller, lightweight boat didn't require the tow vehicle that the big rigs required, nor the big engine and fuel appetite, so that factored into my latest purchase also.

I did as Silvertip mentioned on my last (current) boat purchase. We had two years of drought here and I shopped right before Christmas, '06. Got a nice 2 year old rig for paying off the owner's loan balance. We were both happy. The nicer part of it is I just paid it off.

Just some rambling.

Mark

 

[nightstalker]

Re: Just how bad off is the marine Industry?

I think the problem is three fold. First of all, the slowing economy is severely limiting the surplus $ families have to spend. Second, lending institutions are getting real sticky with their $. Even the boat dealerships make you take a big hit on interest. Have you looked at the $25,000 Bay Boat they will sell you for X dollars a month for 180 months? That $25,000 rig ends up costing you $50,000. Finally, the cost of fuel has got to be affecting what people can spend on this type of recreation. I think the marine industry is not going to be able to ride this one out. They are going to have to entise buyers with higher quality, better service, and lower costs without sacrificing quality.Frankly, I don't know if they can do it.
Nightstalker

 

[tommays]

Re: Just how bad off is the marine Industry?

I am NOT rich BUT far from poor


I use to snow ski a LOT at some point in time when the day ticket HIT 79 DOLLARS it kinda of lost a LOT of its appeal


I am planing my next boat which could be power OR sail (we have owned and enjoyed both)and find that the boat is a small part of the real COST if you go above and easy to trailer size


This has once again put me in THE i really dont enjoy it enough enough to drop 1000 dollars on a day trip even if can afford it and will stick with the 1995 boat and see how things shake out


One of my big issues is that the marine industry as a whole seems to be willing to let their product be sold buy profoundly unqualified dealers

This puts me in the sad position of having to go to great lengths to be sure if i spend 75000 dollars it will even get me a boat that works correctly and can be serviced in a professional manner






Tommays

 

[DJ]

Re: Just how bad off is the marine Industry?

In a FREE market system, which the USA is-for now. The economy is a "self fulfulling phrophecy"

If you claim it as bad, so does the person you told that to and it builds and builds and builds and builds. GET THE POINT?

This is an election year. Some folks want the economy to tank so that they can induce more of their power. Others want it to increase so that they can induce their power.

I'll take the latter.

The "government" cannot stimulate the economy but it sure can WRECK it.

 

[Texasmark]

Re: Just how bad off is the marine Industry?

Enter the news media. Who has more influence on our daily thoughts, especially national news evening anchors whom we learn to "trust with the truth" and refer to them by their first names? Then there's our local friendly 3 or 4 or 5 on the 10pm.

Tough job trying to sort out what is really going on and why. Like DJ said, all these special interests trying to sway you to their way of thinking for whatever reason.

Mark

 

[tashasdaddy]

Re: Just how bad off is the marine Industry?

being retired, i downsized vehicles in 2005, downsized boats and went to aluminum, except for one. have to stretch every buck till it screams.

 

[tommays]

Re: Just how bad off is the marine Industry?

lets just talk about the problems with the marine industry itself

1. You can not buy a chart(chip OR paper) that is not 10 years out of date at best

2. It is out of date because you cant dredge even really important areas anymore on a timely basis

3. One of my big issues is that the marine industry as a whole seems to be willing to let their product be sold buy profoundly unqualified dealers

4. I like what Yamaha is doing with the master tech program and we are lucky enough to have 4 of them in my area BUT the whole industry needs to work harder on this problem

5. I do see some effort towards the BOAT builder being totally responsible for everything they put on a boat BUT it has a LONG way to go



Tommays

 

[Silvertip]

Re: Just how bad off is the marine Industry?

My wife and I attended the Minneapolis Boat Show this week as we do nearly every year. This year we were actually looking for a boat (pontoon) so we were really interested to see 1) attendance and 2) boats. Attendance was in my view dismal at best. In other years, even during the afternoon you had to "shoulder" your way through various areas. This year you had no problem getting up to any display. Boats that listed for approximately $28K and less had some interested and obviously serious negotiation going on. Anything over that price found the representatives talking among themselves. Nobody around. Unlike other years, if you were interested in a small 12 - 16 foot, three seater fishing boat with a 15 HP motor you were out of luck. Even the number of accessory vendors was down significantly. I chalk part of the vendor attendance problem to the cost of space at a show like this. You need to sell lots of stuff to make that worth your while. As with boats, you didn't need to wait to talk to an accessory vendor. I had boat bids going on-line in three states and those bids were all very attractive. I did by a boat from my local dealer for less money and I didn't have to accept non-current stock, got the options and colors I wanted and I don't have to go out of town to get it. So to answer the question about the marine industry, I'd say a dealer that caters to the fishing and small recreational boater here in the midwest will probably weather the storm but business will be down. If the dealer in this area is after the big spender, he better have a crow-bar to get the dudes wallet out his pocket. Evidence of the big spenders having issues was apparent last evening. My wife an I attended a gathering at an upscale golf community. Since we arrived a little early (and made a wrong turn) we toured a dead end street through the houses on the golf course. There were nine or 10 houses (big houses) on this street and five of them had for sales signs out front. I wonder why!!!!!!

 

[Expidia]

Re: Just how bad off is the marine Industry?

My wife and I attended the Minneapolis Boat Show this week as we do nearly every year.

Silvertip, I was going to ask you to see if the 22 Starcraft Islander was at the show. I almost went to it just to see this model upclose, but I saw your orignal post was from Jan 19th.

Did you happen to see one there on display?

Thx