Flooding slows boat sales in the Midwest

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Activity begins to rebound from lingering damage caused by torrential rains swamping Iowa

Larry Rolfson walked into Rusty’s Lake Delhi Marina and RV in Manchester, Iowa, and asked Rusty Peck to assess the damage to his pontoon boat. Rolfson wanted to trade in his damaged two-year-old, 24-foot Aqua Patio and take delivery of a new boat in time for the Fourth of July.

Peck said he be more than happy to take a look, prompting an unusual response from Rolfson.

“I told him, ‘You better bring binoculars,’ ” Rolfson said.

Rolfson kept the pontoon boat tied to the back of his houseboat on the Cedar River. The pontoon boat broke free during the recent floods, floating downriver until it met a railroad trestle that usually passes 15 or so feet above the river.

When the waters finally receded, one of the pontoons caught on the edge of the bridge, leaving the boat dangling from the trestle like a lime on the rim of some bizarre post-flood cocktail.

Railroad officials didn’t allow anyone on the bridge, rendering Rolfson and Peck powerless to get a good look at the damage.

“I thought the guy was nuts trying to trade it in on a new boat,” Peck laughed. “I was like, ‘What the hell am I supposed to see from there?’ ”

The mid-air assessment request capped a memorable couple of months Peck would largely like to forget.

The rain, at first a nuisance that kept boaters off the water, soon became a danger to anything around the water.

“It went from winter to rain,” Peck joked of the seasons.

At the time when he’d normally be trying to sell what’s left of his new-boat inventory to make room for next-year’s product lines, Peck instead found himself trying to snatch his neighbor’s boats, docks and lifts before they floated over the dam.

It wasn’t until the last week of June that Peck started seeing summer-like activity coming back to the marina.

“We made the decision early on that the boat sales weren’t going to be there, so let’s concentrate on our service work,” Peck said.

Wet all over
The nearly four consecutive weeks of rain brought floods that covered the 36,000-square-feet of Cedar Rapid’s Kennedy Marine in muck. Owner Kevin Kennedy spent the days leading up to the flood helping friends prepare for the deluge, never figuring it would reach him.

On the flood’s worst days, Kennedy piloted a jonboat through the streets of Cedar Rapids, rescuing 27 stranded homeowners one day, 17 the next.

“I was boating down streets that very seldom ever flood that had 8 feet of water on them,” Kennedy said. “Some boats in our group were hitting the tops of cars.”

Eight inches above the flood plain, Kennedy wasn’t eligible to purchase flood insurance for his business. The lowest bid to clean it up has been $186,000.

Further upstream, the Cedar River literally separated marinas from their employees.

“I live on one side of the river and work on the other,” said Larry Vaive, General Manager of Waterloo Boats. “For a week, every bridge across the river was closed and we couldn’t even get to our boat store.”

Vaive and his employees were given about four hours notice before the bridges closed. His crew had already moved everything they could out of the store’s basement and installed bilge pumps.

Staff members helped load sandbags into the company trucks that carted reinforcements to the levies. They even donated boats to help rescue homeowners stranded by the rapidly rising waters.

“When the fire rescue called and they said they didn’t have enough boats, what do you do?” Vaive said. “You loan them some of your boats.”

Waterloo Boats, like most of downtown Waterloo, was shut down for five days. Vaive says business is off 75 percent.

“Other than people coming in and buying bilge pumps or hoses, or bringing in motors that were underwater, we didn’t see any customers for 10 days,” Vaive said. “They had no interest whatsoever in recreation at that time.”

Conditions weren’t any better about 70 miles south in the Iowa City area, where the Iowa River turned city streets into the Venetian canal sans the well dressed gondoliers.

Mid River Marine manager Rick Chase said the river started flooding even before the ice on the Coralville Reservoir melted. By the time the second set of rains hit the area, employees were moving everything into storage on higher ground.

For 10 days, more than three feet of water filled the storeroom. The water level closed their boat ramps. Chase estimated the flood could cost as much as $200,000 in damage, repairs and lost business.

“We don’t carry flood insurance because of the expense,” said Chase, who is accustomed to a 15-foot water level rise, not the 34 feet that came this June. “This kind of flood is not likely to happen. What we’ve hit here is the 500-year flood.”

Like Mid River Marine, the Coralville Lake Marina also lost about 10 days worth of business. Perched on ground a little higher than Mid River, Coralville Lake Marina experienced flooding in its gravel storage units, but the showroom was spared.

Good boat-show sales in the months prior to the flood encouraged Coralville owner Dan Rogers. Now he estimates business is off at least 30 percent.

“For the most part I feel lucky,” Rogers said. “I drove through Cedar Rapids and it looks like a bomb went off in that town.”

Thinking survival
Some Iowa marinas are cautiously optimistic their summer won’t be a complete loss. Others see the river as half empty.

In the middle of July. many lakes were not open and many boat ramps were not accessible.

At Coralville Lake Marina, they’d love the opportunity to sell new boats, but for the moment they are concentrating on servicing warranty issues.

“Right now it’s a Friday afternoon, and there aren’t a lot of people on the lake, and I don’t think we have even pumped gas yet today,” Rogers said.

It’s similar story at Mid River, where they are already looking forward to the winterizing business.

Mid River has sold less than half the 25 boats it sold by the end of June last year, and most of them have been at much smaller profit margins.

“When you sell a boat now, you are not making any money on it,” Chase said. “In fact, we are just selling boats to move inventory. If someone walks in to the showroom to buy a boat, we are making sure they leave with one.”

At Waterloo Boats, Vaive hopes the customer relationships they’ve built over the company’s first 40 years carries them through the lean summer. While boat sales are off, service and accessory sales are at least even.

“We’re still optimistic,” Vaive said. “We’re faring better than most dealers.”

Kennedy doesn’t share the optimism.

He, too, is selling on smaller margins than normal, but isn’t willing to sell too close to cost just to empty his showroom.

The flood damage has given Kennedy reason to consider getting out of the business. If he stays, he may turn to offseason layoffs.

“I normally don’t lay people off,” Kennedy said. “I can usually keep them busy, but this time it may be necessary.”

And what of Peck’s efforts to get Rolfson a new boat?

A crane lifted the boat off the trestle and delivered it to Lake Delhi Marina. Peck tallied the damage — he’s being asked to do so many repair estimates for insurance purposes that he’s started charging for them — but was not able to wade through the insurance process quickly enough so Rolfson could get into his new boat for Independence Day weekend.

As soon as the insurance company declares Rolfson’s boat a total loss, Peck expects to deliver a new Harris Flotebote.

“I think business in this country in general is just hurting,” Peck said. “We’ll make it through. We’re tough.”

This article originally appeared in the August 2008 issue.

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