On May 26, Trade Only Today, the e- newsletter service of the US B2B print magazine, Soundings Trade Only, published two stories that appear, at first glance, to contradict each other. The first headline said “Boat sales dropped in April” while the second said “Consumer confidence on the rise”. So what’s going on?
Both headlines are accurate. The first reflected the information from Statistical Surveys that said “Sales of all fiberglass boats, including PWCs, were down 35.2% in April”. This information is corroborated by the Bellwether Report from Info-Link (www.info-link.com/bellwetherreport.asp). The second headline reflected the information contained in a report from The Conference Board (A not-for-profit organization that creates and disseminates knowledge about management and the marketplace) which says their Consumer Confidence Index “is at its highest level in eight months” (www.conference-board.org/economics/ConsumerConfidence.cfm).
The likelihood is that there will not be an up-turn in boat sales any time soon. There are a number of reasons for this. One is that boats are a discretionary purchase and American’s are saving more and spending less. Another is that three out of four current boat owners have household incomes of less than U$100,000 (NMMA 2007 Statistical Abstract), a demographic hurt by the current recession. The key reasons however are that the normal seasonality of boat sales where they start increasing in January peaking in May simply has not happened in 2009 and that boat loans are much harder to obtain.
One of the more compelling statements that we should all be planning on lower levels of boat sales is that quoted on the front page of the June issue of Soundings Trade Only from Brunswick chairman and CEO, Dustan McCoy. He says “We’re not planning for the market to come back to 2005 levels likely within my working career, and I plan to be around for a while.”
Posted by: James
Categories:
Marine Industry