More dealers reported a decline in new-boat sales in September than an increase, with 39 percent saying sales had dropped versus 31 percent who said they had increased, according to a recent survey.
The finding was a “modest surprise, given strong trends over the summer,” noted Baird Equity Research, which administers the dealer survey in conjunction with the Marine Retailers Association of the Americas and Soundings Trade Only.
Retailers indicated that the economy and access to credit positively impacted demand during the month, though several commented that access to credit had tightened and many added that weather, trade-in activity, promotions and government action/inaction negatively impacted demand.
“We have a lot of customers who don't want to buy until after hurricane season,” said one dealer who took the survey.
Another dealer said that customers had been busy with back-to-work and back-to-school tasks.
Sentiment on current conditions was 65, down from 78 in August. However, sentiment on the 3-to 5-year outlook increased from 65 to 73.
While sentiment remains in positive territory, dealers remain watchful of cost pressures and rising floorplan expenses due to increased interest rates, according to the survey.
“With price increases coming and any tightening of credit, next year could be a challenging one,” said one dealer.
Baird expects retailer focus to return to inventory levels and the year’ acquisitions that have been made during the year.
More dealers that responded to the survey said new-boat inventory was too high, 41 percent, and 18 percent reported it being too low; 41 percent said inventory levels were just right.
One dealer said that strong sales are continuing to outpace 2017, though others said “nothing” was working. One dealer said, “not seeing the light at the end of the tunnel.”
Only one dealer commented on “poor quality from manufacturers,” a departure from the last few months, when several said they had the same experience.
“Workmanship has been on a steady decline, and dealers are supposed to make up for the shortfall from the manufacturers,” one dealer said. “We are required to deliver a good product — so should they.”
Read more about the survey’s findings in the November issue of Soundings Trade Only.