Economic Downturn Takes Toll on Boat Builders
Bad news for builders, but potentially good news for buyers hunting for bargains.
August 21, 2009
Info-Link.com's graph shows a significant decline in new boat sales nationwide.
As the economy begins to show a few signs of recovery, it has become clear that luxury items, such as boats, will be among the last markets to revive. Bad news for boatbuilders, but potentially good news for buyers hunting for bargains.
According to Info-Link Technologies, sales of powerboats 15 feet in length and longer dropped roughly 36 percent during the 12-month period that ended May 31, compared with the previous 12 months.
Breaking it down further, sales of outboard-powered recreational boats were down about 31 percent during the same period, and stern-drives and jet boats had dropped 44 percent. Personal watercraft sales, which had been been rebounding slightly before the recession, dipped 31 percent as did sales of outboard-powered sportfishing boats at 45 percent.
Inboard tow boats were hit nearly as hard, with sales dropping by about 39 percent industrywide. Tow boat sales had grown slightly in March 2009, but suffered the biggest monthly decline. Among the hardest hit was MasterCraft, whose unit shipments dropped 58 percent between fiscal 2008 and 2009, according to a report in Boating Industry, a trade magazine. MasterCraft has, however, managed to avoid bankruptcy court, and is restructuring its debts with help from Wayzata Investment Partners LLC, which will become the controlling shareholder. And in an encouraging sign, in July, MasterCraft began rehiring employees it had laid off.
Thus far, MasterCraft is the only tow boat company to restructure under economic pressures, and part of the need stemmed from an excess of inventory. However, many tow boat companies, like many other boatbuilders, have a surplus of models in the pipeline.
For consumers, that typically means manufacturers and dealers are willing to negotiate on price, especially on never-titled 2008 and 2009 models. It also means there may be more than the usual amount of repossessions and slightly used 1- or 2-year-old models on the market.
Editor’s Note: Brett Becker is a freelance writer based in Ventura, CA. He covers the marine, automotive and racing industries for various print and Web titles.
