Marine dealers reported continued momentum in June — the biggest month for boat sales — though confidence slipped somewhat from May.
That’s according to a monthly survey conducted by the Marine Retailers Association of the Americas and Baird Equity Research in which dealers also identified “cost” as the single most prohibitive factor to closing a new boat sale.
The “cost of our products are getting out of control,” one dealer commented in the survey, and another said: “Pricing getting too high; we are making this an elitist activity.”
Fifty-nine percent of dealers surveyed reported growth in new-boat sales, just below the 63 percent reporting growth in May — and that was despite difficult June comparisons. Still, that dropped from last year, when 71 percent of dealers reported growth.
June retailer sentiment of 77 declined from 80 in May, but still remained higher than the sentiment index last year.
The 3- to 5-year outlook edged up to 69, versus 68 in May, positive news after dropping more significantly in the last couple of months. It had been 77 in April and had peaked at 82 in January.
Retailers indicated that weather, trade-in activity and government action/inaction negatively affected demand during the month. On the positive side, retailers report that the economy remains healthy, access to credit is strong and OEM promotions are working.
Dealers listed cost as the single most prohibitive factor to closing a new-boat sale, with 26 percent saying it was the main headwind they faced; 18 percent said it was competing recreational activities; 17 percent said the time factor was the biggest hurdle, 5 percent said the hassle factor turned off prospective buyers; and 34 percent said all of these factors.
“High-end, premium brands continue to lead the parade,” one dealer said. “For June, units were down 10 percent, dollars were up 12 percent year-over-year. We are living on high-net-worth baby boomers and not attracting the younger generations to feed unit growth.”
Several dealers also said work shortages, particularly in the service department, as well as lack of manufacturer support, high taxes, sterndrive, and perhaps surprisingly — fiberglass boats — were all things that were not working.
Pontoons were listed among the most popular things that were working, as well as OEM promotions and warranties, towboats, jet-powered runabouts, outboards and fiberglass saltwater boats.
Read more about the survey results in the August issue of Soundings Trade Only.