Q&A with Sea Ray president Tim Schiek - Trade Only Today

Q&A with Sea Ray president Tim Schiek

Sea Ray president Tim Schiek and his kids get their love of water honestly.
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The 350 SLX Outboard, Sea Ray’s first model with triple outboard propulsion, will be introduced at the Fort Lauderdale show.

The 350 SLX Outboard, Sea Ray’s first model with triple outboard propulsion, will be introduced at the Fort Lauderdale show.

Sea Ray president Tim Schiek and his kids get their love of water honestly.

Schiek and his wife, Robin, live in Knoxville, Tenn., with their three kids — 14, 12 and 9 — who’ve been boating since they were three months old. During the summer, when he’s not working, the Schiek family can be found out on the water together. Last summer, it was on a Sea Ray 270 SLX, which Schiek sold before the boating season closed. That was only because he was trading up for a 280 SLX.

“My family was not happy with me about that,” Schiek says with a laugh.

But as Sea Ray’s president, doesn’t he have the pull to get his new boat sooner? “I won’t put my order in before a dealer order,” Schiek answers quickly. “So I’m not getting my boat before next year.”

Schiek not only gets the water gene naturally, but he inherited Mercury and Brunswick genes, too. His father retired from Mercury Marine after 40 years in the engineering department, having launched his career working for the legendary Carl Keikhaefer at Keikhaefer Marine and finishing it as director of engineering at Mercury High Performance.

Raised in Omro, Wis. (population 2,500), Schiek remembers his father coming home and talking about the marine industry. The senior Scheik was an avid water skier, and Tim and his brother James were on skis daily by the time Tim was 10. At 11, he was competing in three-event water-skiing tournaments — jump, slalom and trick — specializing in water-ski jumping.

After earning an undergraduate degree in finance (while working the engineering docks at Mercury) and an MBA from Marquette University, he left the industry to start a business with his brother called Schiek Sports. That company was born out of making things for water skiers, but it led to weightlifting belts. After selling that company, his brother went on to launch Schiek Ideas, which he still runs.

Tim returned to Mercury in 1995 and has been with Brunswick Corp. since. He began by leading strategic planning at Mercury, Brunswick and the boat group, then became general manager and later president at Harris FloteBote. He subsequently rose to become president of Brunswick fiberglass fishing boats, then Boston Whaler, and then to his current position at Sea Ray, with Bayliner also reporting to him.

Sea Ray has been introducing new models at an incredible pace and gaining market share, so we thought we’d ask Schiek about the direction he has taken with the company and where it’s heading.

The 350 SLX Outboard, Sea Ray’s first model with triple outboard propulsion, will be introduced at the Fort Lauderdale show.

The 350 SLX Outboard, Sea Ray’s first model with triple outboard propulsion, will be introduced at the Fort Lauderdale show.

Q: You’ve been in your current role for a couple of years now. What has been accomplished, and what are some goals looking ahead?

A: We’re awfully proud of where we are today. I’ve established a great team. You will notice many new people in leadership roles who are passionate boaters. They have a genuine concern for our employees, our dealers and consumers — they recognize the responsibility of being a part of such a great tradition and are committed to building on that great Sea Ray legacy.

We have transitioned the Sea Ray business from a functional organization to two distinct business categories — sport yachts and yachts; and then sport boats and cruisers. Each category has a dedicated general manager. This structure better serves these two distinct consumer groups. It drives collaboration across the business and enables us to move with greater speed and agility.

I have two phenomenal leaders overseeing these categories — Brad Anderson, senior vice president and general manager for Sea Ray sport boats and sport cruisers, and Scott Ward, senior vice president and general manager for Sea Ray sport yachts and yachts.

I’d also like to think that I’ve helped clear the way for significant investment in new-product development and encouraging design and engineering to be more innovative, take more risk and be a bit edgier in our design and move into segments that Sea Ray traditionally has not competed in.

Q: You mean, for example, Sea Rays with outboards?

A: Yes. It had been since the mid-’80s since Sea Ray had boats with outboards. And those are going into much larger outboard models, like the 350 SLX that will be introduced in Fort Lauderdale.

Q: Isn’t that the first Sea Ray to have triple Mercury Verados?

A: It is. It’s pretty exciting.

Q: And that’s just one of many new Sea Rays announced for 2017. What kind of R&D goes into such an aggressive schedule?

A: “Aggressive” may be an understatement. I’m not aware of any other brand that has introduced an average of 10 new models a year — with more on the way. We certainly are not done. We have the best people in the industry, focused on driving innovative designs and industry-leading technologies.

As David Foulkes, Brunswick’s chief technology officer, talked about in his Trade Only Q&A, we spend a tremendous amount of time and money focusing on consumer-focused innovation. We ideate around consumer insights to develop technologies that deliver real value to our consumers and provide a sustainable competitive edge.

In addition to having the best team, developing product at this pace also requires robust engineering and new-product development processes to ensure products of the highest integrity that win in the market. It requires you to have the best partners in the industry — and by partners, I’m speaking of our suppliers and our phenomenal dealer network. We’re all in this together, and our success is dependent on each other, so we must work as one team.

Schiek describes the 460 Fly, which also is debuting at the Fort Lauderdale show, as a “gorgeous and social new flybridge model.”

Schiek describes the 460 Fly, which also is debuting at the Fort Lauderdale show, as a “gorgeous and social new flybridge model.”

Q: What are some of the most recent models, and which are the most popular?

A: Wow — great question. We’ve released so many new models and have such strong demand across the board. We have gained share in every segment in which we’ve launched a new boat recently. Most recently, we introduced our new SLX line, featuring four new models — 230, 250, 280, 310 — and let me tell you, it takes sport boating to a new level of luxury and sophistication.

In our sport yacht segment we introduced the new Sundancer 400 and 400 Fly, both of which feature generous interconnected social zones between indoor and outdoor space. The feedback on these models has been incredibly positive.

We have expanded our already successful outboard models to include the new 310 SLX OB and 350 SLX OB — I have to tell you, the performance on those boats is phenomenal. [The 350 is the model with triple Verados; the 310 has dual engines.]

Q: I know that early in some of these new-model introductions, models have been hard to come by and some backlogs were built up. Acknowledging that this is a much preferred problem to have than the other way, how have inventory and production shifted to help get dealers and ultimately consumers the models they’re looking for?

A: I agree with you. We look at backlog as a high-class problem to have. We’re going to do everything to make sure we deliver the highest-class product possible. Having a bit of a backlog, we deem that as good. But we do partner very closely with dealers to plan inventory based on known demand in their territory. As we introduce new models, we work to help sell off the non-current to make room. Our dealer inventory levels and age of product is the best it has been since well before the Great Recession. We feel very good about that. We’re well balanced right now.

Q: And based on what we hear in earnings calls, Brunswick is sticking with a pull rather than a push model?

A: Absolutely. We would rather be more of a pull than a push.

Q: Is there a loss in sales if the backlog is too long?

A: We’ve seen people are willing to wait for our new products, and there is a level of excitement around them. I’d also say we are getting far more balanced. But the SLX models we just launched — we can’t ship them fast enough right now. We will continue to over the next six, nine months, catch that back up. Any time you launch a new product that’s really hot, as you’re ramping up that product, in the first kind of 9- to 12-month range you’re generally catching up a bit on the demand.

Q: What do you think about the challenge of overseas companies looking to compete in the U.S.? I know the Galeons have been really on fire and did really well at the Newport and Norwalk boat shows, and I heard talk about the high quality and the lower price point. Is Sea Ray feeling pressure from some of these discounted boats from overseas?

A: Galeon and Sea Ray are targeted at two very different consumer segments. Our primary goal is to deliver yachts that exceed the needs of the most discerning consumers. We also pride ourselves in offering uncompromised consumer support and experiences. We’re selling a lifestyle that only a company with Sea Ray’s history and legacy can offer. We’re not just selling a price, as we’re seeing some of the manufacturers entering the U.S. market doing.

Sea Ray offers a yachting lifestyle and continues to lead the market. We’re confident we’ll please the yachting consumer seeking the very best. The competition in the 40- to 50-foot range, and then the 50- to 65-foot range, has always been strong. Consumers who are buying Sea Ray yachts and sport yachts, they’re buying so much more than that. They’re buying the legacy of Sea Ray and what Sea Ray stands for, and the extended Sea Ray family that comes around and supports these customers. There’s a lot more to buying a Sea Ray than just pricing.

Q: What are you guys planning for the upcoming Fort Lauderdale show? I know the display there is often impressive.

A: It will continue to be impressive. We’re going to change it up a little bit, but it will be everything you expect from Sea Ray — luxurious, high-end, a great place for consumers to come and spend time with us. We, as always, will make sure we have an area they can come to and really relax and spend time with us. The momentum just continues to build for Sea Ray. Even after Fort Lauderdale, that’s going to continue to build going into Miami. As we go into next year we’re going to be introducing new product in nearly every product family. And we’ll be introducing a boat that — well, I can’t really say anything more about it other than I think it will surprise some people.

Q: You can’t say anything more than that? Surprise us how?

A: Only to look for it in the January time frame. I think people will be surprised.

Q: Well, that’s a tease. But OK, what else are you looking forward to at the Fort Lauderdale show?

A: Fort Lauderdale is a fantastic venue to introduce new models. It’s truly an international audience. It will mark the official world premieres of five new models. The Sundancer 350 Coupe, a sophisticated new take on our iconic Sundancer series. Our new 460 Fly is a gorgeous and social new flybridge model. The two newest SLX models, the SLX 310 OB and 350 OB, which I mentioned before, will be the first Sea Ray that comes with triple Mercury Verados. And then the newest member of the Sea Ray L-Class, the L550 Fly, which we’re thrilled about. We’ve got a lot of really great new product. We’re going to continue to have that steady stream of new products coming out throughout the year. It’s going to be a great show. We’re achieving our growth plans, introducing amazing new boats.

Q: What are you seeing in terms of consumer trends? We mentioned the European presence; has that affected styling? What are other trends?

A: Let’s talk yachts. One consumer trend is that flybridge models have become more popular here in the United States. Aft cabins with saloon doors versus canvas — we’ve seen a strong trend toward aft saloon doors. That way, when they’re done boating, they pull into a marina, just close the doors and walk away instead of putting all that canvas stuff up. The blending of indoor and outdoor spaces is becoming very popular. The two social zones of saloon and cockpit are becoming one.

I mentioned outboard power as being very important, and we have responded with outboard models ranging from 19 to 35 feet. We see this continuing. We continue to see the consumer preference for larger day boating, with consumers wanting more versatility, as they’re doing less overnighting.

Also, consumer expectations for quality are higher than I’ve ever seen them in my 20-plus years in the industry. We continue to see trends around ease of use, like joystick docking. What fantastic technology Zeus and Axius are. I think we’ll continue to see this add growth to the industry. Consumers are looking for connectivity to their boating systems to be more kind of auto-like. We’re also paying close attention to windows and natural light, with sunroofs that open up, as well as the panoramic views these boats have, with the wraparound windshields and all that glass. They’re phenomenal.

One of the things in our new yachts that I hear repeatedly from customers is how much they’re loving the fantastic layouts throughout the yachts themselves. Everything just flows. And with customization there are plenty of ways for boaters to create the layout that works best for them.

Q: What do you identify as some of the long-term challenges to boating today?

A: I do think one of the challenges continues to be engaging the younger demographic and making boating more accessible, both in terms of the cost element and with easy access to boats. We have continued to invest in our SPX line, which would be our entry level for Sea Ray, but is still sporty, accessible and has all the hallmarks of a Sea Ray — great style, that thrilling performance and the craftsmanship.

The Bayliner brand has continued to invest in the Element series. We came out with the 16, the 18 and recently launched a 21-foot Element. That is truly an entry-level product. It’s a great value, it’s got amazing versatility, it’s safe and it is at a much lower price.

The other nice part about the Element is they’re lighter-weight, so you don’t need a large vehicle to tow it. The same thing applies to the 19 SPX, too. We’ve got to make boating accessible and easy. We’ve had such great demand with the Element and with our new 19-foot SPX, so perhaps that’s a bit of an indicator that some of those consumers are coming back.

But I do see that as a challenge for the industry. We don’t have a great answer for it. But Brunswick does continue to want to learn not only about all our boating consumers, but also these trends and learning how to pull new buyers and customers into boating. Is there an opportunity to do boat clubs, peer-to-peer companies like Boatbound? There’s not a clear answer on how to do it, but it’s something we as an industry need to be aware of and work on.

Q: Do you think that post-recession consumers have changed?

A: I truly believe that consumers today, if they’re going to spend this type of money on a product, their expectations are just far higher than I’ve seen, as I mentioned before. I believe that’s a good thing because we should be, as an industry, striving to deliver products that operate correctly, and certainly with more versatility. They want it to be perfect. They also want the options and features on these boats. We are seeing consumers fully load these boats up with premium options.

Q: What do you think is in boating’s favor in the long term?

A: The desire to be out on the water, sharing favorite activities and great conversations with friends and family, is something deep and abiding. There are experiences a person can only have via a boat, and there’s a pride that comes in being able to share those experiences with others. I firmly believe this will continue to fuel demand.

Those of us who have chosen to live the boating lifestyle are truly blessed. My family absolutely loves being together on the water all day. It’s our special time, where Robin and I see our three kids spending time laughing, sharing stories and creating memories that will last a lifetime. I can’t think of another pastime that offers that kind of experience for the extended period you’re out on the water. That’s an advantage boating has over other discretionary buys. It’s our job at Sea Ray to continue listening to our consumers and engaging those passions.

Q: That reminds me of an article I wrote asking some people around my age who grew up boating why they don’t have a boat. All of them said they’d love to have one, but it wasn’t affordable for them.

A: I love having those conversations with people who were born and raised boating, and they will tell me, ‘Hey, my dad had a Sea Ray, and we spent nights on the boat, cruising up and down the coast,’ and sometimes they find that in a new stage of life. They’ll be back.

There are price points out there for everybody. The Element is the leader in that segment. But it is a long-term challenge for the industry, there’s no question about it. There’s no easy answer, and I think we as an industry need to continue to do everything we can to attract new buyers.

Q: To that end, Bayliner recently acquired Heyday boats and the Wake Tractor, which hits a totally new price point in the very popular ski and wake segment. I saw some people mentioning they’re not crazy about the hull design, but the point of that boat seems to be that it can create a wake with the shape of its hull.

A: Absolutely. And that fits perfectly with the Bayliner brand. Here you have a surf boat where you don’t have to have all the expensive equipment to be able to go out on the water and surf. We need to continue to bring innovation and technology like that to the market — those things that attract a younger generation, or those who are not looking to spend as much money on a boat, but are looking to wakesurf or wakeboard, or just get out on the water with family or friends. The response I’ve seen to it is that it’s a great value towboat. Bayliner just celebrated its 60th anniversary in Nashville in Opryland. The dealers are very excited. It’s a great opportunity for them to expand into a new segment of the market that is doing very well. It’s a nice profit opportunity for them.

Q: I really appreciate your time. Is there anything you would like to add to this discussion?

A: Thank you for the opportunity to share some of our developments with you. I can assure you that the boating community will continue to be excited about the Sea Ray and Bayliner brands.

This article originally appeared in the November 2016 issue.

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