Hallelujah! The discussion of when the model year should start and end has been going on for years, but it’s expected to be finally settled when the Senate passes a U.S. Coast Guard reauthorization bill today and sends it to the president.
Specifically, the new model year will begin June 1 and end July 31 of each year as specified in the bill. Further, there is a provision that would allow a manufacturer to apply for an exception to introduce a new mid-year model with Coast Guard approval. That’s similar to the exemption procedure used now for PWC, says Nicole Vasilaros, vice president of federal and legal affairs in the Washington office of the National Marine Manufacturers Association. The exception is also similar to what the auto industry does these days.
It’s hard to believe I blogged in Dealer Outlook about this subject back in 2008. At that time, dealers, via the Marine Retailers Association of the Americas, were urging manufacturers to return to a Sept. 1 date for the new model launch for a variety of reasons. Among them, it could eliminate taking dealers out of their stores for summer dealer meeting at the height of the selling season. Even more, it would level the playing field among all brands, all starting on the same date.
Why, I even recall then-Genmar chairman Irwin Jacobs supported the idea by announcing all his brands would adopt a Sept. 1 changeover. But when other manufacturers didn’t follow he had to drop his plan.
Almost five years ago now, the Coast Guard Office of Boating Safety suddenly, without notice, showed up at the Miami show and cited some new models that didn’t meet the existing Aug. 1 model-year requirements. That led to a painstaking negotiation between a group of manufacturers from the NMMA and dealers from MRAA. There was tremendous give-and-take before eventually finding agreement on a 14-month model year beginning June 1. The Coast Guard reauthorization bill finally codifies that agreement.
“The 14-month model year provides both manufacturers and dealers with the flexibility they needed and wanted in a model year,” NMMA president Thom Dammrich said, “but it also firmly defines the start of a new model year as June 1.”
According to Vasilaros, the model-year text is self-executing, meaning when the bill is signed into law by the president, the new model year will take effect.
The new date raises some interesting implementation questions for dealers. For example, will dealer meetings now be moved to late winter or early spring? Perhaps the Miami Boat Show would become the new IMTEC (if you’re too young in the industry to remember IMTEC, ignore the comment). But could dealer meetings now conflict with the winter boat show season or the normally critical spring selling months?
Nevertheless, a clear benefit is that all builders must adhere to the set model year instead of being all over the calendar. The exception clause in the bill is intended for new and large boats that can be offered after Jan. 2 for the next model year with approval from the Coast Guard. So there is certainty with limited flexibility for dealers and builders.
Moreover, it levels the retail playing field. For example, a dealer can know a boat he’s selling at, say, a winter boat show will remain current for no less or no more time than his competitor’s boat down the aisle. On the other hand, how the consumer might react to the fact that the boat he’s buying at a winter show will become a model year older shortly after he launches it is an interesting question. Hopefully, if the model year playing field is truly level, everyone will be in the same position, so it likely won’t create a selling hurdle.
One thing’s for sure, with the issue finally being settled, we’re now heading for a period of adjustment to implement the new model-year mandate to industry business practices. What impact do you think it will have on your operation?