At a crossroads: Lets not choose the Detroit routePosted on Written by Bill Sisson
The topic had an ambitious title: “Boating at a Crossroads: How to live long and prosper.” It’s a good question. Tough one, too. I was one of four marine business journalists who was scheduled to tackle that subject during a panel discussion at the annual meeting of Boating Writers International held in conjunction with the Miami International Boat Show.
This column is the distillation of my thoughts and notes in preparation for that talk.
For starters, there is no one magic bullet, no cure-all. But knowing that, I have still attempted to put forth, condensed into one sentence, a formula that just might resonate in today’s and tomorrow’s market.
Here goes: What the industry needs to focus more energy on, in my humble opinion, is producing more boats that are simple, sensible, seaworthy and efficient, boats that are well-styled, reasonably priced, and supported by excellent service. It’s worked in the past, it’s what consumers are looking for today and I believe it can help power us out of the current morass. But as I’ve also said on more than one occasion, this stuff is always easier said than done. Much easier.
The idea that bigger and faster – and therefore costlier – is the best model for building and selling boats needs to be rethought. When times were good, many folks bought the biggest boat they could afford – regardless of whether they needed that much boat, horsepower or speed – simply because they could. Money was cheap and available, and there was no sign the party was going to let up.
Conspicuous consumption may return at some point, but for now, that ship has sailed. Welcome to the new norm, where value, at least for middle-class boaters, is the new coin of the realm.
We need to build boats that will inspire people to get back out on the water. The kinds of features that will resonate in this market are things like reliability, functionality, longevity, seaworthiness and resale. Boats that are easy to use, easy to maintain and easy to service. Boats that are more efficient and affordable.
Simple and efficient, however, doesn’t necessarily mean stripped down or bare-bones. To the contrary. What I’m advocating is the wise use of technology – installing equipment and systems that are appropriate for the size, mission and design of the boat. Technology should bring value and utility to the vessel, rather than simply adding cost and complexity. And too often, that’s simply not the case.
The industry is going to have to find ways to pull costs out of boats in order to attract new boaters, retain existing customers and remain competitive with other leisure activities. During a conference with the National Marine Bankers Association last year, Brunswick Corp. chairman and CEO Dustan McCoy warned the industry was in danger of pricing itself out of business as the so-called “affordability gap” widens. Boat prices have been rising faster than buyer income.
Brunswick has not only trimmed the number boat lines it produces, but it’s in the process of scaling way back on the number of options it will offer [see Page 1 story]. That will lead to production-line efficiencies, which should translate into lower costs.
Another way to keep costs down is to build boats designed to be driven with less horsepower – but not boats that are underpowered. That will mean giving up some speed and performance – not to mention losing those granite counter tops on planing hulls – but costs will go down and efficiency will go up. That’s the right direction.
Americans have long had a fondness for big cars, big trucks and big boats with lots of horsepower. And when fuel is cheap, efficiency has not been a strong selling point.
No one really knows from one year to the next where fuel prices are headed but, like it or not, the long-term trend points to higher costs. The upshot of all this is that at some point there will be growing demand for more fuel-efficient boats. The tricky part is anticipating both the timing of this future demand and then building boats that in some cases the consumer doesn’t even know he or she is looking for yet.
If you wait for the customer to show up at your door and tell you exactly what he or she wants, it may be too late. Active builders will develop a new generation of lighter, “slipperier” and more modestly powered (and therefore more efficient and affordable) hulls. Those who are slow to change will be left scrambling – or worse. As an industry, we don’t want to be caught flat-footed, like Detroit.
This article originally appeared in the March 2010 issue.