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Ski and Wake Segment Continues to Dominate Industry Growth

by-the-numbers-nov-2018

August was the eighth month of the last 12 to see double-digit gains in the ski and wake boat segment, with the category growing 14.9 percent year-over-year and 9.6 percent year-to-date, according to Statistical Surveys. Those numbers, derived from 27 early reporting states that represent 62 percent of the market, topped strong gains in August 2017, when ski and wake boat sales grew 10.1 percent year-over-year from 2016 and 6.7 percent year-to-date.

Though the gain was small in overall units — 856 ski and wake boats registered in August versus 745 the year before — the category is a high-dollar segment, says SSI sales director Ryan Kloppe.

“Although dealer sentiment improved into July, we are a bit more cautious over the next 12 months, given a likely more challenging Canadian market and signs of heavier inventory at MasterCraft dealers,” says SunTrust Robinson Humphrey analyst Michael Swartz in a report analyzing dealer survey results.

Sentiment among ski and wake boat dealers in Canada has changed “fairly dramatically” since March as a result of headwinds caused by poor weather and tariffs that went into effect in July on U.S.-built boats. “Most said they would need to cut orders dramatically for model year 2019 — 20 to 50 percent year-over-year — unless OEMs absorbed the incremental cost burden from tariffs,” Swartz says.

New-boat sales were up 4.6 percent overall, and climbed 3.3 percent in the main powerboat categories. “Positive months are always good,” particularly when they come on top of growth in the prior year, Kloppe says.

Aluminum fishing boat sales were up 9.5 percent, with 2,695 units sold versus 2,462 last year. Pontoon sales increased 5.8 percent to 3,452 units from 3,262 last year. There was continued momentum in PWC sales, which rose 9 percent to 6,246 registrations versus 5,731 in August 2017.

A 3.5 percent dip in fiberglass outboard sales coincided with a decline in Florida registrations, the “fiberglass outboard Mecca,” Kloppe says. Those declines could be due to the red tide and algae blooms the Gulf Coast has experienced through the summer. “I sell Bayliner boats and had someone put a purchase on hold because of water-quality issues,” said Tom Papesh, owner of York Road Marine on Pine Island, Fla., in August. “I can’t put a number to it, but the customers aren’t out there boating.”

Papesh was optimistic in the long term, however, saying he believes snowbirds will return for the winter and use their boats no matter what.

Wells Fargo analyst Tim Conder sees solid growth in September against -5.4 percent comparisons over last year — Hurricanes Harvey and Irma impacted sales for the month in 2017 — but he expected to see regional impacts from this year’s Hurricane Florence. “Some OEMs in the Carolina region could also see production disruption as employees recover from the storm,” Conder says in a report discussing August sales.

This article originally appeared in the November 2018 issue.

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