According to a poll published in Forbes in March 2023, more than a third of U.S. adults make at least one New Year’s resolution every year. Improving fitness, at 48%, tops the list of changes people want to make in their lives. Improving finances follows at 38%, while working on mental health comes in at 36%.
I’ve always been a sucker for the New Year’s restart, having joined the gym and started more diets than I can remember. Mental health? I recently stacked up a bunch of dusty self-help books (which I bought with the best intentions) so I could sell them online. I hope the folks who swept them up from my doorstep have better luck with them than I did.
For me, this annual tradition is more of an exercise in procrastination than a way to set intentions and change bad habits. “Oh, I can get back to my morning walks after the holidays,” I tell myself. Or, “I’m going to straighten out my diet, but there’s no way I can do that during Christmas.” We’re all good at excuses, right?
That’s why I prefer to look forward, past the New Year’s resolutions, to get a feel for what the world is in for in the coming year. As I write this, I’m just coming off the fall boat- and trade-show circuit — IBEX, Fort Lauderdale, Metstrade and more — and I’ve been thinking a lot about what the industry can expect, especially as we put together coverage for this, our annual “Look Forward” issue.
Of course, we’ve been hearing about a looming recession for at least two years. Some analysts have said to expect a deep, short recession in 2024, while others are forecasting something less sinister. Perhaps the most well-rounded roundup of what we can expect was presented late last year by ITR Economics forecaster Connor Lokar, during the IBEX Industry Breakfast. He said: “We are forecasting a mild recession for 2024, a speed bump, a normalization. The growth rates that started in the second half of 2020 and carried through the last year were largely not sustainable.”
Lokar was quick to add that there will be a turnaround in 2025, and that there are ways the industry can be better positioned for the future. “It’s going to alleviate the largest pain points in our business — inflation, supply chain and labor,” he said. “We are going to see all those things become easier to manage over the next five to six quarters.”
Inflation — now that’s something everyone is tired of hearing about. Last year, I’d often walk in the house with a bag of groceries and ask my spouse how much we spent. Let me tell you, the $50 grocery bag is still around, as are higher prices at fast-food joints, department stores and just about everywhere else, including boat dealerships and marine-supply stores.
As this issue went to press, University of Michigan Survey of Consumers director Jenny Hsu reported apprehensions that inflation would continue to be a concern in 2024: “Long-run inflation expectations rose from 3.0% [in October] to 3.2% [in November], a reading last seen in 2011. These expectations have risen in spite of the fact that consumers have taken note of the continued slowdown in inflation; consumers appear worried that the softening of inflation could reverse in the months and years ahead.”
If you’ve considered selling or buying a home, it’s likely that interest rates have had some effect on your decision-making, or on the decision-making of your potential buyers. The elevated interest rates that are intended to cool inflation are also having a big impact on the entry-level boat buyer, with more than a few dealers in our Pulse Report survey responding the past few months that this segment of the market has dried up almost completely.
Thankfully, though, there are still cash buyers unaffected by higher interest rates. Dealerships are wise to pay special attention to these potential buyers, especially as the cost of financing floor plans remains high. “Considerably higher interest rates for buyers and dealers with floorplans have drastically affected the affordability of a recreational product,” one Pulse Report respondent said.
The good news is that workforce-development efforts seem to be bringing more skilled workers into the pipeline, and the global supply chain seems to be largely resuscitated. “The pandemic taught us to be much more resourceful,” Torqeedo CEO Fabian Bez told me at Metstrade. “We’re way ahead of where we were when it comes to purchasing not just raw materials, but with chips, too. It’s all much better in many ways.” I’ve heard similar reports from other CEOs this year.
So, looking forward, it seems as if many of the pain points we’ve been talking about for the past few years will be relieved, while new ones continue to challenge us. We’ll obviously see continued economic shrinkage in many areas as the pandemic era further normalizes, but my unscientific crystal ball suggests that 2024 will be more interesting, and less painful, than previous years.
Who knows? Maybe I’ll even go on a diet.
This article was originally published in the January 2024 issue.
