It’s prediction time once more.
Barring any unforeseen globe-rattling economic shocks, we should see a continuation of the slow to modest growth the industry has experienced over the last five years. And against a backdrop of global uncertainty in everything from economic growth to terrorism, more of the same in our neck of the world would be welcome.
Bright spots for presidential election year 2016 include the likelihood of continued low fuel prices, healthy new-boat inventories and steady levels of boating participation. Employment is growing — might wages follow? — consumers continue to spend, and housing is improving.
The bull market is in its sixth year: Long may you run. But just how long the ride continues is an open question. Are those storm clouds gathering on the horizon or merely showers? The bull has been good for boating. Lots of baby boomers bought lots of boats from their brokerage accounts as the market zoomed north.
The Federal Reserve is also about to make a big bet on the economy, with its widely expected increase in interest rates likely to have occurred by the time you read this. (The Fed has held its benchmark federal-funds rate near zero since December 2008.) The first increase will be small. What follows will have more impact. Is the economy strong enough to handle higher rates? We’re about to find out.
New powerboat unit sales in 2015 are expected to come in about 7 percent higher than the previous year, a healthy increase. This year, the number crunchers expect we’ll see moderate single-digit growth in new boats, with the strongest categories enjoying high single- or even double-digit increases. New product and innovation will continue to be the catalyst for new-boat sales.
Work-force issues will remain a challenge in 2016 and beyond, especially as older workers age out of the industry. We have a good story to tell. We need to do a better job of promoting the opportunities that exist across all segments of recreational boating, from small builders to retailers to the large-yacht industry.
Growth also depends in part on strong sport fisheries. As an industry, we need to remain united, vigilant and proactive against all threats. Our fisheries are particularly vulnerable to overfishing, environmental degradation and unfair, poorly conceived regulations.
Time is the new coin of the realm. Folks may have money, but they don’t have the sense there is time to do everything they’d like to do. We are all being pulled in more directions, asked to do more than ever.
The upshot for boating? Expect growth in boat clubs and peer-to-peer rentals. And we should see a continuation of the trend in dayboats, be they simple single-outboard pontoons or large sophisticated multiengine center consoles.
We’re all racing the clock, probably none more so than the boomers, who have been very good to boating and continue to drive the market. Talk to enough of them with the boating gene, and you’ll hear a theme that underlies many of their purchases of new and used boats: If not now, when? Millennials, due to their age, can afford to wait; boomers can’t, and they know it.
For long-term growth, however, the average age of first-time boat buyers will need to drop from its current upward trajectory, and the racial makeup of new boaters will have to become more diverse, as well.
It would be nice to see more affordable entry-level boats make their way into the market. Will young prospects see boating as an activity that provides good value for their discretionary dollars? Long-term growth depends on them answering in the affirmative. Affordability matters, as does product reliability, durability and service. Success is a stool with several legs.
Boating remains a safe family haven in these unsettled times. We heard a lot about the concept of “nesting” in the aftermath of the 9/11 terrorist attacks. I think Americans are again circling the family wagons after the most recent attacks, in France, California and elsewhere. Boating continues to provide a welcome respite in these complicated, uncertain times.
This article originally appeared in the January 2016 issue.