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Norwest Marine Editorial
An article from Richard Thiel, Editor-in-Chief, Power and Motoryacht, titled, "Now Or Never".
Wow, 2009 was some year, one that I personally don't ever care to repeat. Economic indicators dropping like a skydiver without a parachute, and as for the boating industry-well, who was going to buy a boat when they didn't know if they'd have a job next week?
Those of us who've been around the business for a while once bragged about how tough it was back in the early 1990's when the first President Bush imposed the ill-conceived luxury tax. No more. This downturn has made that one look like a paid holiday. Not only has it been way more severe, it's affected everyone. You are no doubt aware that builders of small runabouts [and their suppliers] are grappling with a devastating combination: the near cessation of retail sales and scads of unsold boats clogging their dealer networks. You might not be aware that things are tough at the top, too. Megayacht yards running at full capacity, most likely have not received any new orders since September 2008.
As is the case with the general economy, hopeful signs are appearing. Inventories are shrinking and many builders are cautiously restarting production. The fall boat shows experienced good sales and revealed a fair number of new models, a sign both of builders optimism and their financial solvency.
Speaking of which, the big surprise of this downturn has been how many builders have survived it. Unlike many manufacturers, boatbuilders [at least some of them] apparently have the ability to scale back to hibernation mode and wait things out. Nevertheless, even the survivors have lost a lot of very talented workers who they may not be able to hire back when things improve.
Why does this matter to you, Joe Boater? Two reasons. First, you are probably going to see fewer new models next year since the design-prototype process is so costly. Many builders have survived by hoarding cash and not investing in new products. So even if you see a "New" model, it may actually be a "freshened" version of an existing one. Second, as inventories shrink, the pressure on dealers to sell boats at nearly any cost will fade. So the time when you could absolutely steal a boat is coming to an end.
Indeed, it's not hyperbole to point out that we are in the last stages of an unprecedented and unlikely-to-be-repeated-in-our-lifetime moment: you will never be able to buy a boat-new or used, large or small-at these prices again. EVER. In fact, I'll venture way out on a limb to say to those who bargain smartly now may actually be able to sell the boat they buy today with minimal depreciation and even-yes, I'm going to say it-at a profit tomorrow.
So, it seems, the storm is finally passing. It's time to plan for tomorrow, so let's haul up the anchor and get back underway.
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Norwest Marine
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