In less than three months, you could be receiving some 2017 model-year boats. That’s because President Obama signed the Coast Guard Authorization Act of 2015 and it included an unprecedented model-year change that will impact every dealer.
The Aug. 1 to July 31 model year? It’s gone. The new model year for boatbuilders will start June 1 and last 14 months ending July 31, 2017. The start, then, is two months earlier than the old days and it will last two months longer.
According to the National Marine Manufacturers Association, this extended model year will allow boat manufacturers flexibility to close out old model production while beginning the new model year. In addition, the new law provides a way for any boatbuilder to apply for an exemption and introduce new model designs prior to June 1 in limited circumstances. The request to do so must be submitted to the Coast Guard for approval and details of this exemption process are still to be worked out.
Bottom line: With the new 2017 model year beginning June 1, builders can introduce new models any time on or after June 1 through July 2017. Further, manufacturers can change their new model introduction dates anytime during the 14-month period as long as introduction occurs no earlier than June 1 of any year.
Dealers should immediately find out what their main boat suppliers are planning to do under the new law. They have known it was coming for some time, so they likely have made plans. That, in turn, might require a serious look at possible revisions in any dealer’s inventory strategies for this year and beyond. And given the start date of June 1, this could all come together fast.
One thing’s for sure: the inventory game has just changed.
Smooth sailing for insurance
Good news for our prospects and customers comes from the insurance industry. Low gas prices, good boat sales and ample market capacity are reportedly creating a perfect storm of opportunity for selling boat coverage.
Good profitability in recent years has generated increased competition among carriers, which has led to single-digit premium declines in the recreational sector, thus keeping policies readily available and affordably priced for boaters. Moreover, Sean Blue, global head of watercraft for AIG, revealed there is a high reinsurance capacity that makes for more competitors and continued rate softening.
“We had just a phenomenal season (in 2015) for boating, with no significant catastrophes,” reported Todd Shasha, managing director of Travelers’ personal insurance boat and yacht unit.
The same good story comes from BoatUS. “Overall, we have seen a very manageable amount of claims activity,” reported Mike Pellerin, vice president of underwriting at BoatUS that underwrites member insurance through Geico. “We are seeing more usage-type claims because more people are on the water — hitting an object, running aground, road accidents from trailering, and so on.”
More people on the water, cheaper boat insurance, lower gas prices — what’s not to like about this picture?