Tom Francis wrote:
A Bellwether Report issued last week by Info-Link confirms industry
reports that boat sales have been slow this year. According to
Info-Link's director of sales and marketing, Jesse Wells, "We estimate
that August year-to-date numbers represent 84 percent of all the
registrations that will occur in this calendar year, so the remaining
new boat sales activity isn't likely to have a significant impact
overall. Therefore, it looks like the decline this year over last will
be somewhere between 5 percent and 10 percent, at least for the total
15 ft-plus powerboat market." Wells did report that some segments,
such as ski boats, had better than average performance (see chart at
www.info-link.com/bellwetherreport.asp).

In related news, a report issued this week by independent training and
consulting firm, Spader Cos., shows net profits for the average boat
dealership were down nearly 20 percent during the eight months ended
August 31, compared to the same period in 2005. As of the end of
August, the average dealer earned a net profit of 5.2 percent of
sales, compared to 6.5 percent of sales in 2005.

Here's the fundamental problem with the graph. It lumps all powerboats
over 15-feet into the same category. There aren't very many powerboats
available *under* 15-feet, unless one counts dinghies, etc.

We're somewhat insulated here in the Pacific NW because it's our turn
in the "prosperity barrel" for a change while a lot of the rest of the
country is now beginning to cool off. (I attended a dinner meeting for
board members and stockholders of my wife's bank last night, and a
local guru who was until very recently a member of the Federal Reserve
Board reported that some respected forecasters have just raised their
odds of a national recession in 2007 to as high as 48%). It's been the
other way in the past, with a tough row to hoe up in this corner and
everybody else cutting a phat hog. Almost like being a foreign country,
but I digress....

There's an entirely different market for boats at say, 25 feet than for
boats at 15-18 feet.
And then there's a different market again over 30 feet, and at other
increments as well.

The guy buying a 15-18 foot entry level runabout, maybe doing so with a
small down payment and a monthly nut of $300 for the rest of his life,
is going to suffer a lot more when fuel costs go up. He's only
marginally affording the boat in many cases, and with high revving gas
engine power fuel is, percentage wise, a bigger chunk of his boating
budget.

The guy buying a new 30-footer is going to be slammed a bit less by
rising fuel costs.
If a guy can qualify for and afford a deal where his monthly boating
expenses are $1500 or more before he even gets underway, the difference
between a summer's fuel bill of $2500 and a summer's fuel bill of $4000
probably isn't going to put him entirely out of his comfort zone.

I believe that national stats would show, if expanded, that the
marginally financed entry level buyers of small boats are in short
supply; but once up into a "medium" size boat of say 30-35 feet the
market hasn't been hammered very badly by fuel costs.