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Telltale Signs

Author:
Jeff Moser

Jeff Moser

For six agonizing days in March, massive earth-moving machines and stout tugboats labored around the clock to free the 1,312-foot, 2-inch Ever Given from the Suez Canal mud. An estimated $9.6 billion worth of goods transported daily on the 120-mile east-west connector was stuck.

It finally took an alignment of the celestial bodies — and a high, perigean spring tide — to free the ship and allow the 450 vessels idling in the Mediterranean and Red seas to begin to pass. The true costs still remain difficult to quantify, but one thing is for certain: The grounding happened at a time when the delicate supply-chain balance was already stretched and vulnerable.

Many marine industry leaders have been struggling with these supply-chain issues for more than a year now. In this issue, staff editor Joe Healy explores the myriad factors that, even before the Ever Given grounding, wrenched global trade like a slow, unstoppable train. Healy’s story, “The Supply-Chain Storm” (Page 18), cites the sharp increase in U.S. imports, the lingering effects of the Covid-19 pandemic, the sudden scarcity of shipping containers, the Texas polar vortex and more.

The continuing logistical nightmare has left U.S. boatbuilders — who have been ramping up to meet consumer demand — in real danger of running out of materials such as foam and resin, stainless steel products and, in some cases, outboards.

There’s only so much pressure a builder can put on suppliers and shipping brokers, all of which are attempting to keep raw materials and products moving. This current reality has, yet again, brought members of the recreational marine industry together in unprecedented ways. Boatbuilders are relying on one another to get completed boats off the production line and delivered to anxious dealers and customers.

“All of us are calling each other and trading parts and pieces, trying to help each other,” Sailfish Boats CEO Rob Parmentier says. “We’re a tight-knit group, and when things get a little out of kilter, everybody seems to come together.”

Navico CEO Knut Frostad — a former round-the-world sailboat racer familiar with relying on teamwork to face tempests — says the marine electronics giant reached out to about 200 of its biggest customers to see how each could help the other out. “You discover that there are actually quite a few things we can do on how we plan inventories, how we plan safety stocks, how we plan logistics, how we plan timing and capacity,” Frostad says. “There’s a strong sense in the industry that we’re in this together and that, despite the challenges, we are very fortunate.”

Since the Covid-19 pandemic began and Americans turned to boating in droves, it has been a prosperous time in the marine business. But supply-chain problems remain to be remedied, as does the problem of retaliatory tariffs on U.S.-built boats being sold into the European Union. Those tariffs are slated to rise to 50 percent June 1. The National Marine Manufacturers Association estimates that in the past three years, the 25 percent tariff already in place has cost U.S. builders $400 million in lost sales.

NMMA continues its efforts on Capitol Hill to fix this problem and is looking to bolster business through the proposed American Jobs Plan, which has elements that would address our nation’s aging outdoor recreation infrastructure and man­­ufacturing supply chain.

Meanwhile, the Marine Retailers Association of the Americas cites a need for a stronger relationship between manufacturers and suppliers — with the singular goal of customer satisfaction. In a guest editorial, MRAA president Matt Gruhn says it’s “time for us to come together and recognize that it’s going to take a stronger partnership between manufacturers and dealers to solve the problems that we, ourselves, create for our consumers.”

All of these facts and voices make one thing clear: It’s going to take a concerted effort to rise above the issues we are collectively facing as an industry. New challenges will certainly add to the mix, as well, but seeing how we have come together in the past, I like our chances. 

This article was originally published in the May 2021 issue.

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