Brunswick CEO speaks to investors on market recovery


The new-boat market will rebound to 350,000 units annually again. It won't be anytime soon, but Brunswick Corp. CEO Dustan McCoy told investors this week he is confident that sales will rebound to prerecession numbers.

“We are not planning for that in the next year or two,” McCoy said this week at the B. Riley Annual Investor Conference. “But we think long-term that isn't a reason for us to not stay in this business, and that is why we are weathering this downturn.

“We’re asked a lot — how big is this market going to come back?” McCoy said. “The math is relatively simple.”

Boat registrations have remained constant at about 10.1 million for the last 15 years. Prior to 2007, about 300,000 of the 1.1 million boats registered each year were new and about 800,000 were used, he said.

After 2008, the new-boat side has fallen to 140,000 units. Used boats have declined about 8 percent, versus a 60 percent decline in new boats.

“And fundamentally what we are seeing is people are continuing to boat, but the age of boats has now increased from 16 years to 21 years since 2007,” McCoy said at the conference, which was held May 21-23 at the Loews Santa Monica Beach Hotel in California. “The life expectancy of boats begins to decline at 30 years.

“So if we add all of that arithmetic, it says when the market recovers and the economy recovers and as people continue to boat, the market ought to be around a 350,000-unit market again,” McCoy said.

Brunswick also will look at entering the high-performance jetboat market, a segment that has performed well in the downturn.

“That is an extension we are looking at,” McCoy said.

He also said Brunswick anticipates little restructuring in the coming year and will invest heavily in growth.

Click here to view the webcast.


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