Boat gross sales took off throughout pandemic, sellers cannot sustain with demand
People look at yachts during the Miami International Boat Show in Miami, Florida, the United States on February 14, 2020.
Marco Bello | Anadolu Agency | Getty Images
During the coronavirus pandemic, boat sales skyrocketed last year as more Americans turned to lifestyles in more flexible work environments that allowed people to spend extra time outdoors.
According to the National Marine Manufacturers Association, sales of boats, marine products, and services across the country rose to a 13-year high of $ 47 billion in 2020, up 9% year over year.
The trend, showing few signs of slowing down in 2021, shocked industry players who were sure they were in troubled times as the pandemic brought the economy to a standstill. Now distributors are struggling to maintain inventory and manufacturers are expanding their manufacturing capacity to meet demand. The waiting times for buyers have increased from a few weeks to several months. In addition, first-time buyers are entering the market in greater numbers, a sign that growth is sustained.
Eric Wold, analyst at B. Riley, notes that uncertainty persists when new variants of Covid emerge, even as vaccine rollouts accelerate. This could keep consumers interested in strong boating in 2021.
“There is still not much certainty about when the economy will open again with the launch of the vaccine. So the demand that we saw last year will continue this year at least, and that will be production for the manufacturer push ahead. ” at least a couple of years, “he said.
Owning a boat can be an expensive endeavor. With watercraft prices averaging $ 13,000, boating is typically viewed as a hobby reserved for the rich. According to Frank Hugelmeyer, president of the Marine Association, 61% of boaters have an annual household income of $ 75,000 or less.
First time buyer
Steve Arnold, a 57-year-old owner of two Maine marinas and franchisee of a boating club, saw a massive jump in sales last year. He said sales have skyrocketed across the board, with average new boat sales up 40%, used boat sales up 45%, rental boats up 65% and Freedom Boat Club memberships up 28%. He said he had never seen numbers like this in his 18 years in business.
And while he expects sales to drop 5% to 10% this year, it will still be way above expectations.
He said the effects of the pandemic had had a positive impact on the boating industry, which will last for many years. “I think Covid has changed society for the better when it comes to looking at your family and relationships in your free time,” he said.
When new boaters enter the market, there is a domino effect that also involves their friends and families.
Last year, the number of first-time boat buyers rose for the first time in over 10 years by 10% compared to 2019. Among these new boat buyers, according to the average report, the average age has also decreased for the first time in 20 years. The entry of these new young buyers is a bright sign for the future of the industry, said Hugelmeyer.
“There is never a shortage of friends who want to go out on a boat. They become very popular, and then family and friend groups begin to develop into boat families,” said Hugelmeyer.
Additionally, Americans are finding that their work from home schedule allows for more flexibility in performing activities if they choose to.
“We have these longer term results from Covid, including flexible work arrangements that I believe will allow people to be more flexible about boating this week,” said David Foulkes, CEO of Brunswick. Brunswick is the parent company of popular boat manufacturers such as Boston Whaler and Sea Ray.
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The ‘best year’ for boating
Rick Davis, sales and finance manager at Palmetto Boat Sales, a South Carolina dealer, saw firsthand the surge in consumer demand for boats during the pandemic.
“We thought we were done [last] Year in terms of business, and 30 days later it is just the opposite. It was definitely the best year of my 24-25 years, “said Davis.
Sales of new motor boats in the US rose last year by around 12% to over 310,000 compared to 2019, the Navy Association said. Among the consumer-bought boat categories, freshwater fishing boats and pontoon boats were extremely popular, accounting for half of last year’s motorboat sales. Sales of new wake boats used for wakeboarding and wake surfing rose 20% to 13,000 units in 2020, the association reported.
The membership-based Freedom Boat Club, targeting those who are reluctant to fully commit to buying a boat, has also seen a surge in consumer interest. In the Brunswick Corp. division Membership has increased 61% in 31 states, Canada, and Europe since May 2019.
Brunswick’s most profitable categories during the pandemic were primarily the parts and accessories business, particularly the Mercury Marine brand.
“As more people enter the boating lifestyle and use boats, the general use of boats demands the need for more parts and accessories,” said Craig Kennison, senior analyst at Baird.
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Keep up with demand
Many boat dealers are still there Fulfillment of their backlog this year. Social distancing measures are expected to remain in place in many regions of the country in the near future. Hence, people still buy boats to safely enjoy the outdoors, especially in the temperate months.
Arnold said that prior to the pandemic, the average waiting time for a boat was four to six weeks. Now, he says, it can take customers up to eight months to receive their boat.
Brunswick announced last year that it had expanded its boat manufacturing capacity at three of its manufacturing facilities to meet increased consumer demand. Still, Foulkes said it will be at least two or three years before it can fully replenish its boat dealerships.
“The dealers are looking for boats from us and we are ramping up production as quickly as possible to not only meet retail demand, but also all kinds of demand to fill the pipeline that is very depleted from the field”, said Foulkes.
Sea Ray SLX 400