Q&A with Yamaha Marine president Ben Speciale - Trade Only Today

Q&A with Yamaha Marine president Ben Speciale

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Yamaha Marine Group president Ben Speciale’s enthusiasm extends beyond boats and motors, though there is no shortage of it there. He will talk and talk about cutting-edge technology. But when discussing the political process, he is nothing short of exuberant.

Speciale has been intimately involved in that process through his efforts to reform saltwater fishing regulations. He helped facilitate one of the first recreational saltwater fishing roundtables, bringing industry stakeholders together with legislators, and has made the issue a top priority.

Speciale took over in 2010 as president of the Kennesaw, Ga.-based Yamaha Marine Group, a unit of Yamaha Motor Corp. U.S.A. Involved since childhood in his family’s Tennessee marina and dealership, he joined Yamaha in 1987 at Yamaha Marine Parts and Accessories and has held Marine Group positions in marketing and promotions.

Speciale left the company in 1992 to become fishing production manager at Fenwick Fishing Tackle in Huntington Beach, Calif. He returned to Yamaha Marine in 1996 in strategic planning and financial operations. He was promoted to vice president of operations and planning in 2005.

He serves on the NMMA board of directors and lives in Kennesaw, Ga., with his wife and two daughters. There he spends his time (when he’s not working with boats and motors) playing with boats and motors at his family's marina in Tennessee.

Q: Can you tell me about the Kenai River Classic in Alaska?

A: We’ve sponsored the Kenai River Classic for years. It’s the fishing tournament of congressional members and people who are very passionate about the fisheries. It’s always been a who’s who of senators and governors.

If you spend the money to fish in the tournament, you can earn a plaque. But it’s really about the larger conservation and fishery issues.

I’ll never forget, about 12 or 14 years ago there was some heavy flooding in the Midwest and I was standing outside the lodge and my phone rang, and I was talking to my wife and her mother. I got off the phone and another gentleman … asked if everything was OK. I told him my mother-in-law was affected by the flooding in the Midwest, and he said, “Yes, I just declared it a national disaster area.” He was the head of FEMA. You never know who you’ll meet there.

Last year’s was really neat because it was the first time we were able to get Thom Dammrich from the NMMA, Jeff Angers from the Center for Coastal Conservation, Pat Murray from CCA and Mike Nussman from ASA there. We had the senator in charge of chairing the Magnuson-Stevens Act roundtable meeting. It was a wonderful venue. It was the first time the associations really came together and spoke with one voice, which was a huge accomplishment because we tend to speak with separate voices.

Yamaha has 2,000 dealers in the United States and partnerships with 120 boatbuilders.

Yamaha has 2,000 dealers in the United States and partnerships with 120 boatbuilders.

Q: Do you think there will be a need for this discussion in 2015 or do you see some resolution in the coming year that will render it unnecessary? Or is the need for these discussions ongoing?

A: No matter what we do, no matter what the resolution is [of the Magnuson-Stevens Act regulating saltwater fishing] we have to be more active. We need to do this more frequently. We need to make sure our voice is constantly heard. We’re too big of an economic group; we’re too much of a bunch of small businesses that make up this industry. We’re poster children for the U.S. way of life.

I think we have to be more active going forward because if we don’t, there are other voices at the table driving their directions forward, and that’s not right. We’re too big for that. In the past an individual or a small group would speak, but we haven’t been able to activate the voice of the industry. We need to do that.

Yamaha has 2,000 dealers in the United States. We work with 120 boatbuilders. We are a group of small businesses that touch every congressional district.

Q: It seems there’s been some good traction on emphasizing the economic impact of the industry. It is such a fragmented impact that I think it’s sometimes hard to convey.

A: When we started restructuring our approach to marine government relations, people would tell you [something] was a problem, but nobody could answer the question of what to do. So we sat and talked about what we were going to do. We started developing this idea that we’re going to focus … on the core items.

One is the Magnuson-Stevens Act reauthorization. One is the E15 stoppage. And, of course, engine regulations, which we’ve always been very active on.

In addition, we wanted to start answering the question of what our customer base needs to know, so that when a fisherman goes into a dealership and says, “I hate this red snapper situation,” the dealer has to be able to say, “Here’s what you should do.”

So when the dealer tells us, “Here are the problems,” then we create tools around that, like the marine advocacy tool, where the dealer can go through the Yamaha Marine business portal and send letters on specific items to members of Congress.

We have to find a way to get our dealers to call Congress members and have them come visit them. We can have the dealer sit down and explain things to them. They will be more likely to listen because he’s a small business guy and he’s their constituent. We have to be the facilitator of that process and make sure the research is done so they really understand the issues.

Easily said, difficult to do.

Speciale took over in 2010 as president of the Kennesaw, Ga.-based Yamaha Marine Group.

Speciale took over in 2010 as president of the Kennesaw, Ga.-based Yamaha Marine Group.

Q: Can you speak to attempting to make the industry more proactive?

A: Boards have changed enough to have the right people on [them]. We on the NMMA boards advise Thom on how we want to handle issues. We have placed good people on the various boards.

I would tell you that the really bad management of the red snapper in the Gulf of Mexico — it’s just so obvious that it’s broken — it helps solidify a lot of people to say, “Yeah, this is really clear.” Because typical governmental stuff is not clear. But this is really clear. It’s easier to get more people to understand it on more association boards.

So I think we’ve got to keep doing that and making sure we don’t get the message too complex. With what Scott Deal and Johnny Morris did, the encouragement of the associations, it was real positive to share that stuff and getting a statement out from all of us as an industry association.

Now we’ve got to make sure we keep pushing it down the field. Keep doing this stuff to get more people on board with it. We need to get 218 votes on the House side and 51 on the Senate side, and one more vote in the House to make sure that you’re authorized properly.

Q: I understand the recent bill in the House regarding the Magnuson-Stevens reauthorization was pretty disappointing and not what the industry thought it would be.

A: The political process is not black and white, and it’s laden with little land mines everywhere. Our challenge is not to have a straight path, but to make sure it’s going in the right direction at all times. That’s why I would tell you this is not the end of the process of being politically active. It’s got to be the beginning of the process. And every year we need to have voices more cohesively heard.

For the next 20 years we’re going to be all over it. I ain’t going down without a fight. We’re a great industry. We’re a wonderful industry of small businesses and family-owned, and multi-generational businesses. I grew up in it.

Q: So is this what the marine advocacy tool is about — connecting dealers with their representatives?

A: I say this on stage when we have dealer meetings: If your U.S. congressman doesn’t know you by your first name, you haven’t communicated enough with him. So if you ask me what you need to do to help on these governmental relations issues, the only thing you can really do as a dealer is have your local congressman know you by name so you can call him and tell him how you view it.. That’s what the dealer network can do to help.

Secondarily, the dealers can help when a consumer walks into the dealership and says they’re having this E10 issue. They can say, “Can you imagine what E15 is going to do? You should write your local congressman and tell him that this is bad.” It’s real simple. We have to be the facilitator for that tool.

I can sit in a boardroom with the NMMA or CCC and have these discussions, but the thing we bring to the table is that voice of 2,000 small businesses or 2,200 small businesses. If we can get them all saying the same thing or sending a similar message, it’s a very powerful tool — a very powerful tool.

The corn lobby’s going to have the money every time. It’s the largest lobby organization in the United States. We can’t do that part. But what we have that they don’t have is the number of people who can talk to a senator or congressman about their small business.

Q: I know the American Boating Congress has been trying for so long to break down the hurdles dealers face when talking to Congress. Do dealers articulate to you what prevents them from reaching out to their local congressman?

A: I think the dealer network will take that step if they’re educated. Even I get uncomfortable when you start talking about governmental processes. I think that when dealers have the tools in front of them — they can talk and read the basic direction and content — I think the dealer is willing to take that step. Most of the time people don’t want to do something when they form a fear. Really what it is is lack of top-of-mind knowledge. I think if we can create that, the dealers will take that and run with it.

It’s really easy to get them to talk about the red snapper issue, but the bigger issue is the Magnuson-Stevens Act. Legislatively, is not written properly for recreational fishing. So it’s easy to have someone complain about red snapper, which we all agree is a disaster, but the bigger issue is Magnsuson-Stevens is not written properly for recreational fishing and support.

Q: With BRP offering its jet boat propulsion system to other builders, is that something Yamaha is still considering? Any word on timing if you do decide to make your system available to other builders?

A: Would Yamaha Marine Group consider offering jet engines? I think we’ve made a statement in the past that we’re researching that idea. We are still considering that option. We’re not prepared to make statements or definitive plans to the U.S. industry yet. I want to answer your question, but I can’t really comment on BRP from the OEM supply side. I think one company that was buying that system just got sold, right?

Speciale speaks with a potential customer in February at the Miami International Boat Show.

Speciale speaks with a potential customer in February at the Miami International Boat Show.

Q: Yes, well, Beneteau will now have Scarab.

A: I think our public announcement from the business point of view is we are looking at jet engine supply for the global market. We want to make sure we do it right. If we do it, we do it right. That wasn’t a pretty way of saying it, but it’s the truth. Engines are never done until we’re ready. We just launched the new lightweight 115 after our 200 launch and the 175 launch, so we’ve had a lot of new product launches over the last 24 months.

Our lightweight 200s have really been a home run product for us. That design, that placement, really hit the mark. Our strategy was very simple. We wanted an engine between our 150, which is one of the most successful engines in the U.S., and our 4.2-liter launch that we did in 2010. We wanted that 200 to hit the mark at the right time and bring a lot people back into the marketplace. As the economy started to recover, we were able to accomplish that goal a little bit better than I anticipated, which is nice to see, following up with the 175, which is a variation of that platform.

And this year another platform that we just launched is the F115. We’ve had a 115 platform since 1999, and this is a whole new next-generation platform. It’s a 1.8-liter block with four valves per cylinder, which is a lot more technology. We wanted to make the investment in the long term versus the short term. So we’re pretty excited about those two platforms. It’s multiple engines across those two platforms. Of course, we’re always working on the next one, even though I can’t tell you when that one’s coming.

Q: Any upcoming plans you can share? Does Yamaha plan to go bigger than the 350?

A: If you watch what we’ve done, I think our next generation of V6, 4.2-liter engine block, which is the foundation of our saltwater business, and the foundation of our new SHO business — in 2010 it was a whole brand-new engine block and we introduced the new I-4 cylinder block to that 200 and 175 in the 150 SHO engine lineup. And we just introduced the new 115 foundation engine block, so we’re working through the lineup. It’s exciting stuff. I love new products. Love it! It’s the best part of what we do. Customers love it, too. We like to do it consistently, not periodically. Engines have got to constantly improve.

Our Helm Master system is a wonderful new system for bigger boats to be handled like smaller boats, so if you’re used to a 26-foot boat, you can buy a 30-foot boat, or if you’re used to a 30-foot boat, you can buy a 36-foot boat. The Helm Master system to me makes those bigger boats feel like they drive like smaller boats from a docking, flexibility, usability, cool features [standpoint]. I think you’re going to see more products like that.

Q: Do you think it’s those types of innovations that lure boaters back into boating or lure new boaters into boating? Do some of the conveniences help new boaters or people who are intimidated by boat handling? Or are these primarily geared for people moving up the line?

A: From Yamaha’s perspective, and my numbers might be off, but I think there’s around 11 or 12 million registered boat owners out there today. We sell a couple of hundred thousand new boats a year as an industry.

We tend to sell to much more serious boaters. A guy doesn’t typically walk in off the street and buy a 300-horsepower outboard boat. It happens, but it’s not normal. We feel our job is to continue to improve upon the platforms and the products so that dedicated boat owner and user looks to Yamaha as the step-up product.

So I tend not to look at the Helm Master System as a way to get someone who’s a brand-new boater into a boat. I look at it as something that’s making it easier for someone who is stepping from a smaller into a bigger.

Q: You said the demand for the 200 was more than you expected. Are you still trying to adjust production to meet the demand?

A: We do that every day, yes. We see the changes in that trend and try to adjust that around the platform. We think that engine brought a lot of people who weren’t interested in buying a new boat back in and replacing their current boat with a new boat, or we think we’ve seen lot of repower opportunities with that engine because there’s a lot of old 2-stroke engines that people wanted to get out of. It allowed those old 2-strokes to come off and the new 4-stroke engines to go on.

The other thing about that engine that’s different, kind of like the 150, it touches every niche. We were doing the early conceptual idea for that engine and we wanted an engine similar to our 150, where it’s a great engine on bass boats, or I would say aluminum-type bass boats, pontoon boats, saltwater boats, day boats, twin-engine boats, deep-vee boats.

Early on, when we were having discussions with our group of boatbuilder advisers, for lack of a better term, we were wondering: Should it be digital throttle and shift, or mechanical? Half would say mechanical and half would say digital. That’s why we did it both ways.

Q: How important is value to the consumer? How does the overall industry rebound look? It’s been a long haul, and how has the consumer fundamentally changed in how they’re buying and spending?

A: I don’t think we have any different view of the economy than everybody else. The economy is slowly getting better, kicking and screaming. It’s starting to get better. We feel comfortable with the growth curve of the U.S. economy and that it’s going to continue to do what it’s doing with a slow recovery.

The overall industry health, I think, continues to get better. I don’t like to blame weather for anything, but I have to say weather probably impacted the industry this year.

I think the industry is going to continue to recover. I personally believe that new-boat sales will be something in the 2 to 2.2 percent total boat ownership per year. I don’t see how it can’t get to that level. It’s been less than that over the last three or four years, I guess five or six years now. It dropped, I think, as low as 1.1 or 1.2 percent.

That might not mean a lot from a percentage point of view, but typically a boat should last, we think, 35 to 40 years, in the marketplace. When it’s at 1.2 to 1.4 percent, it has to last 60 to 75 years if I’m doing the math right in my head.

We think it needs to be in that 40- to 45-year range, which says we should be replacing about 2 percent of the boats a year. We’re not there yet, but we’re moving back to that level.

I think consumer buying habits have changed in the United States. I’m not a big believer that if you build it cheaper, it’s better. I’m a big believer that if you build it better, it has more value and people will buy it for that value. We did mechanical and digital on the F200 because it adds value to the product, but it’s not about price. I say that because you pull the engines off the boat that’s 28 feet long and you don’t have to gut control systems and cables and gauges and stuff.

Our large-engine platform is stronger than anybody in the industry, and they’re not cheap. They’re expensive. Why are the large engines selling better than small engines? Because when people step up to buy new product, they want everything in it. They want it the way they want it. There’s a value curve in that. You can always build something cheaper and take the quality of features out of it.

Q: I think the last time Trade Only did a Q&A with you, you had just gotten into your new role there. More than four years later, what do you see as your biggest accomplishment to date and what do you still want to do moving forward? What are some of the challenges ahead for the industry?

A: I think the biggest accomplishment is, no doubt, the transition. I worked for Mr. Phil [Dyskow, former Yamaha president] for many years, and the transition went way better than just about anyone, I think, anticipated. I’ve been very fortunate to create a team here of marine professionals that are well respected in the industry and dealer network, and we continue to make great strides against our core business plan. Our recovery has outpaced the industry. … We’ve been able to introduce next-generation products in a consistent manner that have more technology, not less, that have all been very successful by any measure.

One of the things I’m most proud of is the team coming together to improve the training aspect at a business level and also a marine technician level. I’m a big believer that it’s our responsibility to drive a better-educated marine technologist into the marketplace. This should be a career for these people that they’re respected at all levels, internally and externally. We were training something less than 1,000 technicians a year, and we had almost 1,600 this last training season and we’ll be able to train over 1,800 next year. My goal is to get it to 2,200 technicians a year coming to fixed-base classes. That’s a foundational change that we continue to make strides in.

The sales, marketing and distribution side — I’m very proud of the fact that we keep down the value-added cost. I want the value in the product, not the whistles and the bells.

The thing I’m probably most proud of is what we’ve done with government relations. We felt these issues were big issues. If I was asked what the biggest challenge to this industry was, I’d say, there was never a bigger impact than the Magnuson-Stevens Act. We need to come up with a doable action plan that we can take to the marketplace. So we can cause change to happen in the industry. I’m just very proud of the fact we’ve been able to do it, and we’re very passionate and it just started. And this is not the end, it’s just the beginning. We’re going to make it part of our culture.

Those are things I really like seeing that we’ve done in this last [four years]. We want to continue to push forward on those initiatives. We’ve got competition; they’re all nice people, I like ’em all. Don’t really worry about them too much. They do their game, we do our game. We all have different business approaches.

Going forward, the biggest challenges? I think the consumer is really smart and that’s always a big challenge. They see things every day that we don’t see, and our challenge as a company is to make sure that we are constantly [building] to what the real consumer desire is, and ask is that really what he wants? I always say nobody ever asked for an iPhone before they launched it. Now I can’t imagine living without it.

The industry going forward? We have to be very aware of unintended consequences of government and regulations. I don’t think people do it on purpose. Our job is to make sure that unintended consequences don’t happen that negatively impact our business. Those people aren’t evil. They didn’t mean to do this. It’s just that we weren’t sitting at the table when decisions were made so our voice was heard.

We have to be at that table every time. If someone says something about the marine industry, I want them to say, “Well you need to go talk to these three people in the industry and make sure we don’t screw this up.” Wouldn’t it be cool if they called you? We’re nice people. We don’t want E15 in gasoline because I’m worried it’s going to break 12 million boat owners’ boats. That’s all. Just use another chemical that doesn’t do what ethanol does, like isobutynol. Put all the butynol you want in it. I don’t care. Renewables are no problem. We don’t like ethanol because it breaks engines.

The Magnuson-Stevens Act, the reason why we want it done properly is because the recreational fisherman is being punished for something he didn’t do. Red snapper management is an example of something that’s bad. They didn’t do anything wrong. We’ve been protecting the environment more than any commercial fisherman ever has. No doubt about it. Fishermen care more about the waters and waterways than anybody, no doubt about it. We’ve got to make sure we don’t have unintended consequences anymore.

This article originally appeared in the August 2014 issue.

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