Wells Fargo CDF President: ‘Dealer inventories are too high’


Dealer inventories across the industry are too high, according to Wells Fargo CDF President Bruce Van Wagoner. Van Wagoner told Trade Only Today in early May that the company was lowering its 2019 sales growth estimates to 1 percent in units and 5 percent in dollars.

Van Wagoner said last week that Wells Fargo revised the forecast and expects sales to be down 1 percent in units and “slightly up” in dollars. Inventory levels remain about 20 percent too high across the industry.

He called Brunswick Corp.’s decision last week to reduce production “responsible.”

“Most other major OEMs are also cutting back,” Van Wagoner told Trade Only Today. “They don’t really advertise the fact because they’re not publicly traded. But that’s being smart to bring inventory levels down. The numbers are too high. The dealers took on too much inventory. But they’re now being very thoughtful about what they’re ordering.”

Van Wagoner noted that MarineMax inventories are among the lowest among the U.S. dealer network. “The biggest and best dealers are performing better than the market,” he said. “It’s not surprising, since they work with the largest OEMs. A lot of mom-and-pops might be dependent on smaller OEMs.”

Van Wagoner said Wells Fargo’s models forecast that new-boat sales will continue to slow through 2019, with aluminum-boat sales falling 4 percent by year’s end, runabouts running flat with last year, towboats up 6 percent, and saltwater fishing boats “down a little bit.”

For 2020, its forecasting model shows boat sales rising again to about 3 percent. “We think aluminum may bounce back to 2 percent, pontoons up 4 percent and runabouts about flat with 2019,” he said.

The industry remains “healthy,” Van Wagoner said, with inventory turns at about twice a year. “We’re still sitting in a very good position,” he said. “Generally, the manufacturers and dealers are responding to the situation very well. I imagine if some boatbuilders try to jam sales they will get a big push-back from their dealers.”

When asked if this was similar to 2008 leading up to the downturn, Van Wagoner said: “They’re reacting much faster now. This is nothing like that time.”


A Win for Gulf Reef Fish

The newly authorized DESCEND Act requires anglers to use descending gear when releasing catches in federal Gulf of Mexico waters.

Coast Guard Foundation Names Chairman

Thomas A. Allegretti will lead the non-profit’s board of directors.

In-Person Charleston Show Opens Friday

Under Covid-19 guidelines, the South Carolina boat show has a modified format for the safety of attendees and exhibitors.

Polaris Sees Q4 Surge

The powersports manufacturer had solid gains in every segment, with boat sales up 20 percent.

ABYC Updates Board

The group added a new member and elected several officers, including Nancy Cueroni as chairman.

Quick Hits: January 27, 2021

ICOMIA release its latest state of the industry report; one of the country’s largest waterjet cutting machines goes online at Maine’s Front Street Shipyard; and T-H Marine Supplies names a new national sales and marketing manager.

Q&A with Martin Bjuve

Volvo Penta of the Americas president and lifelong boater Martin Bjuve.

Changing Currents

E-mobility efforts remain centered outside of the U.S.

The Evolving Retail Culture

Finding new ways to connect with boaters.