As I write this, the presidential election is a couple of days away. Like many of you, I’ve been harboring a lot of anxiety about it. As it turns out, so have a lot of folks who are considering a boat purchase, according to Marine Retailers Association of the Americas president Matt Gruhn.
“The uncertainty in the marketplace continued to take its toll through late summer, and as we’ve noted previously, we expect consumer activity to remain slow until after the election,” he says.
New-boat registration numbers, which you can see in detail on Page 48, prove it. Every single category of powerboat registrations over 15 feet was down collectively in August by 9.3%, a concerning trend that started in February after almost two years of growth from post-pandemic normalization. The runabout and personal watercraft segments took the hardest hits, down 15.8% and 18.4%, respectively.
The good news is that most of the industry players I spoke with at the Fort Lauderdale International Boat Show in late October didn’t expect this situation to last, but they were also guarded about their hunches. Some worried about one presidential candidate’s trade policies, remembering the tariffs that made business difficult in the past. Some were concerned about the other candidate’s government overreach, remembering regulations that made business difficult in the past.
By the time you’re reading this, the votes will (hopefully) have been tallied and a new president chosen. We should also know which way Congress has swung. Only time will tell what the effects will be on the boating industry, but a general sense of uncertainty likely will remain long after Election Day.
Plenty of dealers have elevated inventory levels going into the new model year, as evidenced by our “Pulse Report” on Page 47. Combine that situation with still-high interest rates that affect floorplan financing, and many dealers are wringing their hands over the cost of carrying dated inventory. Factor in depressed consumer sentiment, inflation rates and other factors, and you have a booming market — for anti-anxiety medication.
This guardedness was evident in some of the consumers I spoke with at FLIBS, too. Though plenty of people were ready to buy, an almost equal number were waiting things out. Two couples I talked with were putting off a purchase until well into next year, citing concerns about what will happen to the economy and their retirement accounts. One gentleman I met at the show’s food court said, “The uncertainty is aggravating.”
Still, there are reasons to be optimistic. The job market has sprung back in the past year, with unemployment registering at 4.1%, a figure economists say represents a healthy situation. Though consumer sentiment is still depressed, there are some encouraging signs in the economic tea leaves. You can read contributor Jack Atzinger’s detailed jobs and economy report with industry analysis on Pages 43 to 45.
All that said, perhaps the most encouraging thing I felt in Fort Lauderdale was the astounding optimism of the industry. Despite the headwinds we’re facing, most every industry participant I spoke with felt that our situation is only temporary, and that better things are yet to come. “There’s some pain in the market now,” one dealer told me, “but we have lots of reasons to be looking up. We’ve got better products to offer than we ever have, and all we need to do is knuckle down and get creative with how to get them into prospective customers’ hands.”
Attendance numbers from the show had yet to be released as this issue went to press, but the feeling from those I spoke with indicated that the quality of prospective buyers was off the charts. “The people I interacted with over the last few days were serious buyers,” one sales representative said. “They may not be ready to buy now, but they are definitely going to pull the trigger within the next 12 months. That’s exciting.”
As we head into 2025, I think there are several good reasons to be optimistic, along with the reasons for concern. We are, indeed, offering some of the best products the industry has ever produced, from some of the most capable hands we’ve ever had. Boaters will fall in love with them, and will continue to embrace the idea of going cruising or fishing to get away from it all.
I wish everyone a prosperous, safe and Happy New Year.
