Ordering 2022 malibu’s mid-year 8% surcharge

[Hemmy]

31 minutes ago, Slayer said:

This out to do wonders for the used boat market.  

They are selling their demo 2021 G23 for 195k.  They have a new S23 at the show that they had listed for 165k.  That is after they are done with it for their demo boat for this summer.  He told me it will be available in August.  Already selling used boats before they are used.

[Slayer]

46 minutes ago, Hemmy said:

They are selling their demo 2021 G23 for 195k.  They have a new S23 at the show that they had listed for 165k.  That is after they are done with it for their demo boat for this summer.  He told me it will be available in August.  Already selling used boats before they are used.

I'm not at all surprised by that.  It's interesting watching the pricing variability in the used market.  Very interesting....

[hethj7]

$230K for a demo 2021 G25 with 60 hours at our local show.  

[Shea]

I just came across this thread and found the back and forth really interesting.  As a Malibu Boat Inc stockholder I pay really close attention to things such as quarterly earnings calls, as I do for any stock I hold.  I encourage all to read the Q2 Earnings Transcript as well as Q1.  You can find it easily as it's always published online soon after.  Jack Springer had the pleasure of noting, among many other positive things...  "Record net sales increasing by nearly 35% to $264 million OVER the prior year." Same period.  "And net income growing 40%."  Also over same time period last year.  Lots of interesting things, net income growing 40%, yet net income was only $31 million.  That's not exactly stellar, It's poor actually.  Until you factor in the fact they bought a couple companies last quarter and are likely paying for those companies over this and the next few quarters.  This quarter they also purchased a supplier in another state that supplies wiring harnesses, yet still increased net profit by 40%.  It's a 130,000sq ft facility.  Meanwhile they also doubled the size of it Maverick Plant 2 facility to increase the production of that line.  

As a stockholder, I'm excited about that.  I love Malibu boats, I honestly wouldn't consider buying anything else.  I truly believe they are the best, most beautiful and innovative boats on the water.  But as a customer, who received a phone call in January about the price of the boat I ordered and signed a sales agreement on, going up by thousands of dollars...?  Just doesn't sit well with me.  It was my birthday and I said.  "Yeah, no worries.  I'm sure there costs are skyrocketing.  I get it, I'm a business owner and I want Malibu to be successful."  But after reading the Q2 Earnings Report, I'm sitting here thinking...  Really!?  I spent and committed to spend a few hundred thousand dollars to order a new boat for the spring and I got a call last month asking for thousands more while you set financial records?  AND continued to purchase more companies with those record earnings, expand those failing companies and there facilities!? 

Don't blame the price increase on supply chain issues and inflation.  Be honest about your goal for market domination.  

Sorry for the rant.  I just think it's wrong to call someone who has already ordered a boat and tell them it's going to cost more because of all the difficulties you face when you are breaking company financial records and buying up companies.  While blaming the price increase on inflation.  I get things cost more, there are supply delays and companies are struggling but while Malibu may be struggling to meet demand, they are not struggling to far exceed there financial goals and using that money to purchase 3 or more companies in the first 2 quarters of this year. 

 

 

[Surf4FamFun]

23 minutes ago, Shea said:

I just came across this thread and found the back and forth really interesting.  As a Malibu Boat Inc stockholder I pay really close attention to things such as quarterly earnings calls, as I do for any stock I hold.  I encourage all to read the Q2 Earnings Transcript as well as Q1.  You can find it easily as it's always published online soon after.  Jack Springer had the pleasure of noting, among many other positive things...  "Record net sales increasing by nearly 35% to $264 million OVER the prior year." Same period.  "And net income growing 40%."  Also over same time period last year.  Lots of interesting things, net income growing 40%, yet net income was only $31 million.  That's not exactly stellar, It's poor actually.  Until you factor in the fact they bought a couple companies last quarter and are likely paying for those companies over this and the next few quarters.  This quarter they also purchased a supplier in another state that supplies wiring harnesses, yet still increased net profit by 40%.  It's a 130,000sq ft facility.  Meanwhile they also doubled the size of it Maverick Plant 2 facility to increase the production of that line.  

As a stockholder, I'm excited about that.  I love Malibu boats, I honestly wouldn't consider buying anything else.  I truly believe they are the best, most beautiful and innovative boats on the water.  But as a customer, who received a phone call in January about the price of the boat I ordered and signed a sales agreement on, going up by thousands of dollars...?  Just doesn't sit well with me.  It was my birthday and I said.  "Yeah, no worries.  I'm sure there costs are skyrocketing.  I get it, I'm a business owner and I want Malibu to be successful."  But after reading the Q2 Earnings Report, I'm sitting here thinking...  Really!?  I spent and committed to spend a few hundred thousand dollars to order a new boat for the spring and I got a call last month asking for thousands more while you set financial records?  AND continued to purchase more companies with those record earnings, expand those failing companies and there facilities!? 

Don't blame the price increase on supply chain issues and inflation.  Be honest about your goal for market domination.  

Sorry for the rant.  I just think it's wrong to call someone who has already ordered a boat and tell them it's going to cost more because of all the difficulties you face when you are breaking company financial records and buying up companies.  While blaming the price increase on inflation.  I get things cost more, there are supply delays and companies are struggling but while Malibu may be struggling to meet demand, they are not struggling to far exceed there financial goals and using that money to purchase 3 or more companies in the first 2 quarters of this year. 

 

 

Read your rant and raise you one.  I get making money when you can but crying supply chain and inflation then treating repeat customers like disposable one time buyers was my complaint.

[Hemmy]

10 hours ago, Shea said:

I just came across this thread and found the back and forth really interesting.  As a Malibu Boat Inc stockholder I pay really close attention to things such as quarterly earnings calls, as I do for any stock I hold.  I encourage all to read the Q2 Earnings Transcript as well as Q1.  You can find it easily as it's always published online soon after.  Jack Springer had the pleasure of noting, among many other positive things...  "Record net sales increasing by nearly 35% to $264 million OVER the prior year." Same period.  "And net income growing 40%."  Also over same time period last year.  Lots of interesting things, net income growing 40%, yet net income was only $31 million.  That's not exactly stellar, It's poor actually.  Until you factor in the fact they bought a couple companies last quarter and are likely paying for those companies over this and the next few quarters.  This quarter they also purchased a supplier in another state that supplies wiring harnesses, yet still increased net profit by 40%.  It's a 130,000sq ft facility.  Meanwhile they also doubled the size of it Maverick Plant 2 facility to increase the production of that line.  

As a stockholder, I'm excited about that.  I love Malibu boats, I honestly wouldn't consider buying anything else.  I truly believe they are the best, most beautiful and innovative boats on the water.  But as a customer, who received a phone call in January about the price of the boat I ordered and signed a sales agreement on, going up by thousands of dollars...?  Just doesn't sit well with me.  It was my birthday and I said.  "Yeah, no worries.  I'm sure there costs are skyrocketing.  I get it, I'm a business owner and I want Malibu to be successful."  But after reading the Q2 Earnings Report, I'm sitting here thinking...  Really!?  I spent and committed to spend a few hundred thousand dollars to order a new boat for the spring and I got a call last month asking for thousands more while you set financial records?  AND continued to purchase more companies with those record earnings, expand those failing companies and there facilities!? 

Don't blame the price increase on supply chain issues and inflation.  Be honest about your goal for market domination.  

Sorry for the rant.  I just think it's wrong to call someone who has already ordered a boat and tell them it's going to cost more because of all the difficulties you face when you are breaking company financial records and buying up companies.  While blaming the price increase on inflation.  I get things cost more, there are supply delays and companies are struggling but while Malibu may be struggling to meet demand, they are not struggling to far exceed there financial goals and using that money to purchase 3 or more companies in the first 2 quarters of this year. 

 

 

Would you rather pay a little more for your boat or have your investment lose money?  At the end of the day, all public companies' goals are to keep growing, whatever it takes to keep investors happy and buying more shares.  I owned a company and sold it to a public company 5 years ago.  I still work for the company.  When I owned it, we were very competitive and gaining a lot of business because we undercut some of our competitors.  We had low overhead so that helped us do that.  Profits were still strong, but occasionally we would eat certain increases so we didn't ruffle any feathers with our customers.  We tried to gain back what we had to eat by becoming more efficient to keep our profits strong. 
Over the course of the last five years, we are probably one of the more expensive suppliers of our products.  When we have received increases there has been no hesitation to pass that along to the customer.  Fortunately, in this time, it is much easier to do than before.  None of our customers even flinch when I drop off a price increase.  They have actually come to expect it.
Every year when we are budgeting and forecasting, the board of directors expect to see a growth in profits, which means we can't afford not to pass on the price increases.  It all comes down to keeping the investors happy.  The way things are right now, if you don't buy that boat, somebody else will.  You aren't leaving Malibu because you can't afford "their" boat, because chances are, you can't afford a competitors either.  You can't point the finger at Malibu because it is industry wide.  As a public company, it only makes sense for them to buy other companies and continue to grow the brand and also try to keep as much of the production of parts and accessories in house as possible.  Malibu keeping as much in house as possible is partially the reason why Malibu's are a better deal than Nautiques and Mastercrafts.  Compare MBUU to Mastercraft's stock.

[Steve B.]

To over simplify, what are contracts for then? With no "not to exceed" clauses or anything?

Steve B.

[Shea]

4 hours ago, Hemmy said:

Would you rather pay a little more for your boat or have your investment lose money?  At the end of the day, all public companies' goals are to keep growing, whatever it takes to keep investors happy and buying more shares.  I owned a company and sold it to a public company 5 years ago.  I still work for the company.  When I owned it, we were very competitive and gaining a lot of business because we undercut some of our competitors.  We had low overhead so that helped us do that.  Profits were still strong, but occasionally we would eat certain increases so we didn't ruffle any feathers with our customers.  We tried to gain back what we had to eat by becoming more efficient to keep our profits strong. 
Over the course of the last five years, we are probably one of the more expensive suppliers of our products.  When we have received increases there has been no hesitation to pass that along to the customer.  Fortunately, in this time, it is much easier to do than before.  None of our customers even flinch when I drop off a price increase.  They have actually come to expect it.
Every year when we are budgeting and forecasting, the board of directors expect to see a growth in profits, which means we can't afford not to pass on the price increases.  It all comes down to keeping the investors happy.  The way things are right now, if you don't buy that boat, somebody else will.  You aren't leaving Malibu because you can't afford "their" boat, because chances are, you can't afford a competitors either.  You can't point the finger at Malibu because it is industry wide.  As a public company, it only makes sense for them to buy other companies and continue to grow the brand and also try to keep as much of the production of parts and accessories in house as possible.  Malibu keeping as much in house as possible is partially the reason why Malibu's are a better deal than Nautiques and Mastercrafts.  Compare MBUU to Mastercraft's stock.

Well said, and point well taken.  I was just fired up about it.  I do feel a little misled as the dealer told me about a potential price increase and I sped the purchase process up in order to get in prior to that price hike.  In no way was it suggested that a price increase could, or would be applied to ordered boats that had not been delivered yet.  There is also nothing in the sales agreement mentioning prices are subject to increase.  I recently ordered a new truck, the dealer made it very clear to me that the price may increase between now and delivery and I signed off on that.  Maybe my frustration is a little misguided.  Or, maybe I should be thankful that I can afford it and just be happy that I have a new boat coming this spring!  

Thanks for you thoughts 

[jjackkrash]

44 minutes ago, Shea said:

  I do feel a little misled as the dealer told me about a potential price increase and I sped the purchase process up in order to get in prior to that price hike.

There is also nothing in the sales agreement mentioning prices are subject to increase. 

Any sales contract is with the dealer, not Malibu, unless it is a factory shop, or unless Malibu signed off on it.  I'd also be curious to see all the terms of the contract.  I'd be surprised if it really locks anybody into anything until the boat shows up and money and title change hands, but it really depend on all the specific terms you agreed to.  

[Shea]

1 hour ago, jjackkrash said:

Any sales contract is with the dealer, not Malibu, unless it is a factory shop, or unless Malibu signed off on it.  I'd also be curious to see all the terms of the contract.  I'd be surprised if it really locks anybody into anything until the boat shows up and money and title change hands, but it really depend on all the specific terms you agreed to.  

ADDITIONAL TERMS & CONDITIONS
In this contract the words I, me and my refer to the Buyer and Co-Buyer signing this contract. The words you and your refer to the Retailer.

I understand that the term "rig" used in this contract may sometimes be used to describe the Boat, Motor, Trailer or any item or combination of items as described on the front of this agreement.

I FURTHER AGREE (continued from front side of contract):

IF NOT A CASH TRANSACTION. If this purchase is not a cash transaction. I will, BEFORE or AT THE TIME OF DELIVERY of the boat or rig purchased, in accordance with the terms and conditions on the other side of the contract, sign a retail installment contract, security agreement or other agreement as may be required by law in form and substance satisfactory to you.

TITLE. Title to the boat and/or rig purchased will remain in your possession until the agreed price is paid in full in cash, or I have signed the forgoing retail installment contract or security and it has been accepted by a bank or finance company at which time title passes even though the actual delivery of the unit purchased may be made at a later date.

REAPPRAISAL OF TRADE-IN. if I am making a trade-in and it is not delivered to you at time of the original appraisal and if later, on its delivery, it appears to you that the have been changes made in the furnishings or accessories, or in its general physical condition, you may make a reappraisal. I understand and agree that this later appraisal value will then determine the allowance to be made for my trade-in.

FAILURE TO COMPLETE PURCHASE. If I fail or refuse to complete this purchase within the time specified by the agreed upon terms of this contract or if not specified, then in accordance with the uniform commercial code of the state of your jurisdiction for any reason (other than cancellation because of an increase in price), you may keep the portion of my cash deposit as you determine will reimburse you for expenses and other loses because I failed to complete my purchase. If I have given you a trade-in, you may sell the trade-in, at public or private sale, and deduct from the money received an amount equal to the expenses and losses you have incurred because I failed to complete purchase. I understand you shall have all the rights of a seller upon breach of contract, under the uniform commercial code of the state of your jurisdiction. In the event legal action is brought by the dealer for the enforcement of the terms of this contract or that the purchase contract shall be referred to an attorney who takes action in any manner to enforce said contract. Buyer agrees to pay reasonable attorney fees and court costs incurred by the Retailer.

CHANGES BY MANUFACTURER. I understand that the manufacturer may make any changes in the model, or the designs, or any accessories and parts from time to time and at any time. If the manufacturer does make changes, neither you nor the manufacturer are obligated to make the same changes in the unit I am purchasing and covered by this contract, either before or after it is delivered to me.

TAXES. I understand that the price of the "rig" I am purchasing does not include any taxes imposed by any governmental agency or authority prior to or at the time of delivery unless it is written on the other side of this contract. I assume and agree to pay, unless prohibited by law, any and all taxes, except income taxes, that may be charged on my purchase, regardless of the person having the primary tax liability.

DELAYS. I will not hold you liable for delays caused by manufacturer, accidents, strikes, fires, or any other cause beyond your control.

EXCLUSION OF WARRANTIES. I UNDERSTAND THAT THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR

A PARTICULAR PURPOSE AND ALL OTHER WARRANTIES EXPRESS OR IMPLIED ARE EXCLUDED BY YOU FROM THIS TRANSACTION AND SHALL NOT APPLY TO THE GOODS SOLD. I UNDERSTAND THAT YOU MAKE NO WARRANTIES WHATSOEVER REGARDING THE "RIG" NOR FOR ANY APPLIANCE

MANUFACTURERS WARRANTIES. I UNDERSTAND THAT THERE MAY BE WRITTEN WARRANTIES COVERING THE "RIG" PURCHASED, OR ANY APPLIANCE(S) OR COMPONENT(S). IN SUCH EVENT YOU WILL GIVE ME COPIES OF ANY AND ALL WRITTEN WARRANTIES SUPPLIED BY MANUFACTURERS.

INSPECTION. I have examined the "rig" and find it suitable for my particular needs. I have relied upon my own judgment and inspection in determining that it is of acceptable quality. On a special ordered unit, I have relied on mu inspection of the display model(s), the brochures and bulletins provided by the manufacturer, in making my decision to purchase the unit described on the reverse side of this agreement.

INSURANCE. I understand that I am covered by insurance on the "rig" purchased on the front of this contract and that it is my responsibility to secure insurance. I will not hold you responsible for any claims due to loss or damage whatsoever.

TRADE-INS. If I am trading in a "rig", I agree and certify;

On the date of this Contract, the trade-in will become your property and I will deliver to you a certificate of the title or registry or

award of number of my trade-ins showing the name of the sole owner together with proper bill of sale or other instrument or

transfer sufficient to transfer title to you along with the delivery of "rig" to your place of business.

If my trade-in is registered or licensed in a state outside of the one where this order is written. I will immediately have the

trade-in licensed and or registered in the state you indicate and I will pay all expenses and registration or licensing fees required. If you handle the registration or licensing of the trade-in, I will reimburse you for the expenses on demand or you may add that amount to this Contract as if it has been originally included.

I CERTIFY that this rig is solely owned by me and that there are no liens or other security interests against "rig" except for those noted on the other side of this contract and that all taxes or every kind have been fully paid, in the event that any government agency makes levy or claims a tax lien or demand against my trade-ins, you have at your option, either pay it and I will reimburse you on demand, or you may add that amount to this Contract.

I FURTHER CERTIFY that the trade-in is seaworthy and that its equipment is in sound running condition; that the engine block, manifold, and cylinder head(s) are each free of cracks or defects. I understand that if within 30 days after delivery of my tradein, you find that the "rig" is not seaworthy or the equipment is not in acceptable condition that you may, at your option, cancel this Contract or make such repairs or replacements as are necessary to place it in a saleable condition and deduct the cost from the trade-in allowance.

BROKERED "RIGS". I understand that all brokered and used "rigs" are sold "as is" and that you make no warranty whatsoever unless set forth in writing on the other side. I have examined the used "rig" and I am satisfied with its condition and that the optional equipment and accessories included with it is in good working order.

THE TERMS AND CONDITIONS ON BOTH SIDE OF THIS CONTRACT CONTAINS THE ENTIRE UNDERSTANDING BETWEEN YOU AND ME AND NO OTHER REPRESENTATION OR INDUCEMENT VERBAL OR WRITTEN HAS BEEN MADE WHICH IS NOT INCLUDED IN THIS CONTRACT.

Smps

Page 2 of 2 Rev. 9/30/2021 8:25 AM Initials: ________

[Shea]

This is the second page.  1st page is signed by me, and the dealership below the negotiated price. 

[jjackkrash]

Interesting.  Thanks for posting. I see a lot of buyer obligations; not a lot of seller obligations.  And this caught my eye:

***

If I fail or refuse to complete this purchase within the time specified by the agreed upon terms of this contract or if not specified, then in accordance with the uniform commercial code of the state of your jurisdiction for any reason (other than cancellation because of an increase in price), you may keep the portion of my cash deposit as you determine will reimburse you for expenses and other loses because I failed to complete my purchase. If I have given you a trade-in, you may sell the trade-in, at public or private sale, and deduct from the money received an amount equal to the expenses and losses you have incurred because I failed to complete purchase. 

***

The bold seems to imply that the dealer can increase the price and then you can refuse to purchase through cancellation.  But it is sure not spelled out very clearly.  

[Shea]

17 minutes ago, jjackkrash said:

Interesting.  Thanks for posting. I see a lot of buyer obligations; not a lot of seller obligations.  And this caught my eye:

***

If I fail or refuse to complete this purchase within the time specified by the agreed upon terms of this contract or if not specified, then in accordance with the uniform commercial code of the state of your jurisdiction for any reason (other than cancellation because of an increase in price), you may keep the portion of my cash deposit as you determine will reimburse you for expenses and other loses because I failed to complete my purchase. If I have given you a trade-in, you may sell the trade-in, at public or private sale, and deduct from the money received an amount equal to the expenses and losses you have incurred because I failed to complete purchase. 

***

The bold seems to imply that the dealer can increase the price and then you can refuse to purchase through cancellation.  But it is sure not spelled out very clearly.  

I certainly agree with you there, I do feel they should add language to clarify though.  I guess my thought at the time was by me and the dealership signing the first page directly under a breakdown of the negotiated price, I was committing to purchasing at that price and they were committing to sell at that price.  I also gave them $107K deposit because I had just sold my previous boat...  Not the brightest thing I've ever done, although DEFINITELY not the dumbest either!  Live and learn I guess.  I think I was just so excited about getting a new & bigger boat that I didn't really take the time to process what I was reading and failed to ask good questions. 

[The Hulk]

On 2/8/2022 at 12:49 PM, Hemmy said:

Went to my local boat show, which is pretty small.  There were only three brands of wakeboats there, Nautique, Moomba and Supra.  The Nautique dealer is only a couple miles from my work so I go in there quite a bit for odds and ends things for the boat or lake.  I was talking to one of the guys at the show and he said Nautique already told them that they will be having a 10% increase in Q4 this year.  I did not get into what their  most recent increases have been and when they took place, but they already announced this to some of their dealers for later this year.

Several toon companies are planning spring 7-10% hikes due to aluminum continual rise as aluminum may increase up to 30% higher due to magnesium shortage. Nearly all boat lift and dock companies are claiming a similar hike by spring as well.. 

Went to our local boat show.. normally 2 halls now only 1.. not as many boats and nearly all were sold.. even less junk and trinket vendors.. general sentiment from every vendor is boat shows are a thing of the past.. inventory is basically all sold if they can get it.. shows are a big expense and hassle towing boats in grimmy winter conditions, cleaning, setup/teardown etc.. 

Sadly their right... Shows are dying.. 

[Five Cent Worth]

Our Bu dealer and Nautique didn't participate in the bigger downtown show this year.  They had their own at their respective dealerships.

And for what it is worth - wholly wow the pricing on '22.  We are talking well over 40% for a '22 that is the same as a '21.

[Shea]

3 hours ago, Five Cent Worth said:

Our Bu dealer and Nautique didn't participate in the bigger downtown show this year.  They had their own at their respective dealerships.

And for what it is worth - wholly wow the pricing on '22.  We are talking well over 40% for a '22 that is the same as a '21.

Wow...  Really!?  '22 is up over 40% from '21!!?  I wasn't shopping for a new boat in '21 so I had no idea it was up that much in one year.  I figured it had come up over time from '18, that was the last time I purchased a new Bu.

[Dsalyers]

40% would have priced us out of the early 2021 model we got. That’s very sad to think about. 

[hethj7]

4 hours ago, Five Cent Worth said:

Our Bu dealer and Nautique didn't participate in the bigger downtown show this year.  They had their own at their respective dealerships.

And for what it is worth - wholly wow the pricing on '22.  We are talking well over 40% for a '22 that is the same as a '21.

This doesn’t seem right as MSRP, even with the new surcharge isn’t up that much.  Are you also going from a great dealer deal before to where the dealer isn’t providing you as much discount on the street price?  

[Shea]

1 hour ago, hethj7 said:

This doesn’t seem right as MSRP, even with the new surcharge isn’t up that much.  Are you also going from a great dealer deal before to where the dealer isn’t providing you as much discount on the street price?  

I agree.  I just looked at my 2018 purchase and it's up about 40% from May of 2018.  I would be surprised if it happened all in the last year but I can't say for sure that it didn't.  

[NWBU]

The year over year MSRP change, including the 8% surcharge, is roughly 21%.

A change in pricing philosophy, from discounting off MSRP, to now not discounting as much, or anything, from MSRP, could move it 40%. Interesting to see a dealer make the big of a leap though.

[Steve B.]

Off topic but, could a dealer sell a floor model at any cost they want to try ? 

Steve B.

[Cole2001]

17 minutes ago, Steve B. said:

Off topic but, could a dealer sell a floor model at any cost they want to try ? 

Steve B.

Yes and they are. Similarly look at any of the hot new vehicles right now, TRX, bronco, c8

[Dsalyers]

Yeah and the car makers are starting to push back on those dealerships threatening to cut their allocations for charging exorbitant markups over MSRP. 

[NWBU]

When boats start going for more than MSRP, I’ll sit that round out.

Try buying a plane right now. Lead time for one of the Cirrus models went from April 2023, six weeks ago, to March 2024 now. Next week it will be into April/May 2024.

[Stevo]

18 minutes ago, NWBU said:

When boats start going for more than MSRP, I’ll sit that round out.

Try buying a plane right now. Lead time for one of the Cirrus models went from April 2023, six weeks ago, to March 2024 now. Next week it will be into April/May 2024.

G5 ??