Boat sales rise during pandemic, traders can not sustain demand

Boat sales skyrocketed during the coronavirus pandemic last year as more Americans focused on the lifestyle amid more flexible work environments that allow people to spend extra time outdoors.

Sales of boats, marine products and services across the country jumped to a 13-year high in 2020 to $ 47 billion, up 9% from the previous year, according to the National Marine Manufacturers Association.

The trend, which shows little sign of slowing down in 2021, shocked players in the industry who were sure they were in tough times because the pandemic shut down the economy. Now traders are struggling to maintain inventory and manufacturers are expanding their production capacity to meet demand. Waiting times for buyers have increased from a few weeks to a few months. In addition, first-time buyers are entering the market in larger numbers, a sign that growth has lasting power.

Eric Wold, an analyst at B. Riley, notes that uncertainty still exists with the new Covid variant emerging, even as vaccination is accelerated, which could keep consumers’ interest strong in 2021.

“There is still not much certainty in terms of when the economy will start deploying the vaccine again, so the demand we saw last year will continue at least until this year, and it will continue to produce to drive the manufacturer for at least a few years, ‘he said.

Owning a boat can be an expensive endeavor. With prices for personal watercraft averaging $ 13,000, boating is usually seen as a hobby reserved for the rich. According to President Frank Hugelmeyer, marine association, 61% of boat vessels have an annual household income of $ 75,000 or less.

Steve Arnold, a 57-year-old owner of two Maine marinas and a boat club franchisee, saw a big increase in sales last year. He said sales across the board have skyrocketed, with average sales of new boats up 40%, boat use up 45%, rental boats up 65% and Freedom Boat Club membership up 28%. He said he had never seen such numbers during his 18 years in the business.

And while he expects sales to drop 5 to 10% this year, it will still be better than expected.

He said the effects of the pandemic had a positive impact on the boating industry that would last for years to come. “I think Covid has changed society for the better with regard to your family and your relationships in your discretionary time,” he said.

As new boaters enter the market, a domino effect takes place, with their friends and family members.

Last year, the number of first-time buyer shots increased for the first time in more than ten years, an increase of 10% compared to 2019. Among these new boat buyers, the average age also decreased for the first time in 20 years, according to the Marine association. The entry of these new young buyers is a good sign for the future of the industry, Hugelmeyer said.

“You never have a shortage of friends who want to go on a boat. You become very popular and then family and friend groups start to expand to become boat families,” Hugelmeyer said.

In addition, Americans find that their work schedule offers more flexibility to do activities whenever they want.

“We have these long-term outcomes of Covid, including flexible work arrangements that I believe will enable people to sail more flexibly during the week,” said Brunswick CEO David Foulkes. Brunswick is the parent company of popular brands such as Boston Whaler and Sea Ray.

Rick Davis, sales and financial manager at Palmetto Boat Sales, a South Carolina retailer, experienced firsthand how much consumer demand for boats grew during the pandemic.

‘We thought we were done for that [last] years, as far as matters are concerned and 30 days later, it is actually the opposite. It was definitely the best year in my 24-25 years, ‘said Davis.

The Marine Association said sales of new motorboats in the U.S. rose by about 12% last year to more than 310,000. Among the categories of boats purchased by consumers, freshwater fishing boats and pontoon boats were extremely popular, accounting for the half of motor boat sales last year. The association reports that sales of new wakeboats, used for wakeboarding and wake surfing, increased by 20% in 2020 to 13,000 units.

The membership-based Freedom Boat Club, which appeals to those who do not want to fully commit to buying a boat, has also had a growing interest in consumers. The division of Brunswick Corp. has seen a 61% increase in membership since May 2019 in 31 states, Canada and Europe.

Brunswick’s most lucrative categories during the pandemic were mainly the parts and accessories, especially of the Mercury Marine brand.

“As more and more people work in boat style and use boats, the overall use of the boat is the need for more parts and accessories,” said Craig Kennison, senior analyst at Baird.

Many retailers are still to fill their backlog of orders starting this year. Social distance measures are expected to remain in many areas of the country in the near future, so people are still buying boats as a way to enjoy the outdoors safely, especially in the more temperate months.

Arnold said that before the pandemic, the average waiting time of a boat was four to six weeks. Now he says it can take up to eight months before customers receive their boat.

Brunswick announced last year that it had expanded its production capacity in three of its manufacturing facilities to meet the growing consumer demand. Still, Foulkes said it would take at least two or three years before he could fully recharge his boat dealers.

“Traders are looking for boats from us and we are increasing production as fast as we can, not only to meet the retail demand, but also to meet all kinds of demand to fill the pipeline, which has greatly depleted the field supply, said Foulkes.