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Everything Is Not as It Appears

New-boat registrations are still dropping, but the culprit is inventory, not demand
Aluminum, Fiberglass undefinedMarkets at a Glance: The data represents 23 states, approximately 57.5 percent of the U.S. boat market. Coast Guard information undefined(documented vessels) is complete. If you have questions, contact Statistical Surveys, (616) 281-9898. statisticalsurveys.com

Aluminum, Fiberglass undefinedMarkets at a Glance: The data represents 23 states, approximately 57.5 percent of the U.S. boat market. Coast Guard information undefined(documented vessels) is complete. If you have questions, contact Statistical Surveys, (616) 281-9898. statisticalsurveys.com

The decline in new-boat registrations intensified in March, according to monthly totals from Statistical Surveys. All but one of the 15 vessel categories tracked in the survey saw fewer registrations in March 2022 compared with March 2021. The declines steepened in March from prior months, with nine of the categories falling at least 20 percent.

The March report tallied data from 23 states, representing approximately 57.5 percent of the U.S. boating market. Among the categories with more than 1,000 boats registered in March 2021, PWC products suffered the most severe decline in March 2022, at 30.1 percent. The inshore/offshore fiberglass category fell 20.3 percent. Ski/wakeboat registrations were down 14.5 percent.

Ryan Kloppe, Statistical Surveys’ sales director, says the problem is not slowing demand for boats, but instead scant inventory to satisfy the still-healthy retail appetite. Because 2020 and 2021 were the most active years for new-boat purchases since 2007, the registration declines thus far in 2022 should not be interpreted as market weakness.

“[They are] tough year-to-year comparables,” Kloppe says. “With little to no inventory out there, you are not getting the walk-in sales. What’s being registered is not a true reflection of the demand.”

Registrations for all industry segments in the 23 states fell by 19.7 percent, to 17,149 units, in March 2022 from 21,350 in March 2021. Year-to-date totals as of March were down 12.5 percent. The main powerboat segments fell a combined 15.7 percent in March and 10.8 percent for the first three months of the year.

Only one of the 15 products posted a gain in March, and that was by a single boat in the sail category. Sailboats were one of two product lines still up year-to-date, by 6 percent. Also higher year-to-date was the semicustom and custom yacht category, with registration totals posting a gain of 14.7 percent for the three-month period.

Looking ahead, Kloppe says, some categories would be able to restock boats faster than others, with perhaps aluminum fishing boats rebuilding inventory quicker than the more expensive and complex powerboats. Fishing boats normally enjoy more walk-in sales at retailers, so a comeback in that category could happen soon.

When reporting first-quarter earnings, Brunswick Corp. announced that it would produce at elevated levels this year to satisfy preorders, and said that retailers generally have still enjoyed stronger same-store sales. The main challenge when selling new boats is supply-chain bottlenecks upstream, not any significant demand erosion downstream.

“I’m not concerned about the drop in any product segment,” Kloppe says. “Almost every boat coming off the line is going to be presold.”

Kloppe also says that only 23 states reported for the March compilation, compared with around 30 that he usually gets in the monthly survey. That means the March data may not represent the broader U.S. boat market.

“There is still strong demand,” Kloppe says. “People are still ordering. They are still willing to put a deposit down and wait for these units. … I’m pretty sure we’re not going to have inventory this year, again.” 

This article was originally published in the June 2022 issue.

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