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State of the Boat Market?


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It was only 6 months ago that we were griping about an 8% increase...but folks generally paid whatever it took to get a slot cause inventory was non-existent and production was slow.  Stock market was booming, gas was cheap, etc.

Now, production seems to be increasing (anecdotally, TMC members seem to be getting their boats and dealers are starting to actually have *some* inventory on their lots).  Combine that with gas prices ~2x, stock market down ~20%, interest rates up...i can see those combining to give shoppers pause before splurging on that fancy wake-boat. 

Since TMC members come from a variety of geographic areas and industries, i'm curious what peoples experiences / opinions / crystal ball says on whether the boat market has passed a peak or not?

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2 hours ago, Hemmy said:

Unfortunately, the price of resin keeps going up so prices of new boats will as well. 

From the RV side  of things, a year ago RV retail sales were outpacing production.  Now it is the opposite.  So far production has outpaced 2021 however retail is down from 2021 this time a year ago.  While retail is still good, it has slowed down.  In fact, within the last few weeks, a lot of the RV manufacturers have really cut back on production.  Many of them are taking the week of Memorial day off and 2 weeks for the 4th of July.  On top of that, they are only running production 4 days a week.  Many dealers can't take on any more units on their lots because they don't have the floor plan for them.  Their line of credits for units is maxed out and partially because the line of credit stayed the same while the cost per unit jumped dramatically.  We are anticipating things slowing down by almost 20-30%.  This could eventually lead to layoffs.  The RV industry has always been a key indicator of what's to come.

thats exactly the kind of perspective / harbinger i was curious about; especially the potential line of credit limitation given the large increases in per unit cost happening (I work in government, so somewhat detached from reality LOL).

will be interesting to see the lag in both new and used boats prices/inventory, especially at the end of summer/early fall.

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I have noted that for the first time since covid, our dealer actually has dealer stock boats.  I was there dropping off my 25 for the recall repair and noted they had a decent stock.  Still not like it was BC (before covid), but better than the last 2 seasons.

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Posted (edited)

I get prices of resin is going up still. But in my opinion, the boat market/RV is going to slow down or even crash here real soon. People can’t do 5+ dollar gas for years to come. 

But I already see buddies getting their money back on new builds and not going through with their new boats. I also see the local Nautique dealer with un-sold boats and at Active Water Sports with a fair amount of un-sold boats. It sucks to see how far down the stock market is with me being so close to retirement….lol 

Edited by dwc032
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Local dealer (MNInboard) seems to have a ton of boats available and is even having their demo event this weekend where they bring a bunch of boats out to Lake Minnetonka for joy rides.

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IMHO we are just past the peak.  I recently sold my '17 22 MXZ for every dollar I had in it (including interest, upgrades, repairs, maintenance, and gas).  I really wanted to sell it last fall, and I think I got lucky to lock in the sale before the market starts dipping.  The guy I sold it to is trying to flip it and catch the pico top, and I wish him luck.  I don't think the risk adjusted return is worth it.

We aren't seeing dealer stock yet, in my area, but lag times are definitely dropping.  

Consumer credit has entered bubble territory over the last couple of years, with people working less and playing more.  Many bought RVs and Boats they could not afford, and will soon start to feel the pressure of debt crushing their lifestyles.  We haven't seen the effect of these underwater notes because used prices have been adequate to pay them off.  As used prices start to slump,  I fully expect to see a glut of foreclosed boats and RVs hit the market. Thankfully, I don't think we will have a full-blown housing collapse, ala 2008.  Banks and consumers seem to have learned their lesson about leveraged mortgages on 2nd and 3rd homes.

MSRPs will likely hold stable, but a return to the discounts that regular buyers previously enjoyed should be on the table by next year.  

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1 hour ago, Slayer said:

I have noted that for the first time since covid, our dealer actually has dealer stock boats.  I was there dropping off my 25 for the recall repair and noted they had a decent stock.  Still not like it was BC (before covid), but better than the last 2 seasons.

When did you drop your boat off?  I was at Tommy's in Grand Rapids a few weeks ago dropping mine off and they had 2 boats.  When I went back to pick it up there last Saturday, I think they had a total of 7.  I was told they transferred some over from the Detroit location because they had quite a few on hand.

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53 minutes ago, Hemmy said:

When did you drop your boat off?  I was at Tommy's in Grand Rapids a few weeks ago dropping mine off and they had 2 boats.  When I went back to pick it up there last Saturday, I think they had a total of 7.  I was told they transferred some over from the Detroit location because they had quite a few on hand.

I dropped it off early Saturday morning. They did transfer a few over there as I understand it. 

 

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I keep an eye on https://www.onlyinboards.com/SoldBoats.aspx - here's the reported counts of springtime Malibu boat sales (new or used).  Take with a grain of salt because not every boat sale is reported on onlyinboards.

2019

  • March:  33
  • April:  61
  • May:  60
  • total: 154

2020

  • March:  34
  • April:  63
  • May:  128
  • total: 225

2021

  • March:  74
  • April:  60
  • May:  57
  • total: 191

2022

  • March:  49
  • April:  51
  • May:  24 (up to 5/17 - so roughly multiply x2 to project full month. let's say 47)
  • total: 147

Seems like market is softening

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ahopkinsVTX
25 minutes ago, jjthehodag said:

I keep an eye on https://www.onlyinboards.com/SoldBoats.aspx - here's the reported counts of springtime Malibu boat sales (new or used).  Take with a grain of salt because not every boat sale is reported on onlyinboards.

2019

  • March:  33
  • April:  61
  • May:  60
  • total: 154

2020

  • March:  34
  • April:  63
  • May:  128
  • total: 225

2021

  • March:  74
  • April:  60
  • May:  57
  • total: 191

2022

  • March:  49
  • April:  51
  • May:  24 (up to 5/17 - so roughly multiply x2 to project full month. let's say 47)
  • total: 147

Seems like market is softening

Maybe. Still on pace/above compared to 2019. I don’t think you can compare to 2020 and 2021. That was the highest we’ve ever seen for sales and especially the used market. 

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Posted (edited)

What. What....   Almost like Hulks RV news long ago was true! Haha

We've been in recession for a few months people just haven't figured it out yet... 

Q1 earnings for most companies were still good from carry-over from 2021 backlogs . Q2 and onward the earnings reports will be murdered... Stagflation killing everyone and Their profits... Corporate and residential

 

Edited by The Hulk
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And Incase anyone thinks those hard to get overseas parts, resins, chems, widgets, are going to be getting faster..

 

Chart is already few wks old!!!

IMG_20220509_075332.jpg

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17 hours ago, dwc032 said:

I get prices of resin is going up still. But in my opinion, the boat market/RV is going to slow down or even crash here real soon. People can’t do 5+ dollar gas for years to come. 

But I already see buddies getting their money back on new builds and not going through with their new boats. I also see the local Nautique dealer with un-sold boats and at Active Water Sports with a fair amount of un-sold boats. It sucks to see how far down the stock market is with me being so close to retirement….lol 

I think many of us have been thinking the same thing.   Orlando Magic Basketball GIF

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Interested to see how this plays out with new boat prices.  Massive increases the last 2 years.  Do they eventually correct?  Used wake/ski boats have held or increased in price largely due to the increases in new the past 10 years or so.  I feel like this will continue unless new stagnates.  

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21 hours ago, bigskydoc said:

The guy I sold it to is trying to flip it and catch the pico top, and I wish him luck.

This sounds ominous to me.  I know used boat/car dealers make a living doing this, but when random individuals try to jump in for a quick buck it reminds me of 2006 when everyone decided they were real estate investors cause prices only go up...

i'm certainly in the camp of spending irrational amounts of money on boating in the name of creating family memories, but viewed it as a known loss (like spending on a vacation).  Simply can't wrap my head around boats being an asset that holds (or appreciates!) in value.  Doesn't sound sustainable and I'm hoping any correction is a soft landing for the industry.

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59 minutes ago, theloungelife said:

Interested to see how this plays out with new boat prices.  Massive increases the last 2 years.  Do they eventually correct?  Used wake/ski boats have held or increased in price largely due to the increases in new the past 10 years or so.  I feel like this will continue unless new stagnates.  

The only way this happens is if sales drop considerably and raw materials drop considerably.  The latter I think is less likely than the prior.

27 minutes ago, CaptainMorgan said:

This sounds ominous to me.  I know used boat/car dealers make a living doing this, but when random individuals try to jump in for a quick buck it reminds me of 2006 when everyone decided they were real estate investors cause prices only go up...

i'm certainly in the camp of spending irrational amounts of money on boating in the name of creating family memories, but viewed it as a known loss (like spending on a vacation).  Simply can't wrap my head around boats being an asset that holds (or appreciates!) in value.  Doesn't sound sustainable and I'm hoping any correction is a soft landing for the industry.

Crazy times!

 

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16 minutes ago, Slayer said:

The only way this happens is if sales drop considerably and raw materials drop considerably.  The latter I think is less likely than the prior.

Crazy times!

 

Stagflation.... 

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The belt tightening has begun indeed. I am on a few RV forums since getting into it this year (good timing as usual Matt... Real slick...) and a number of folks are canceling trips they've had booked for over a year. There are real talks of Diesel rationing on the East Coast (northeast) by summer. It's looking more and more like my planned RV trip back home to WI this summer will involve staying in hotels and crashing with family while there. Can't justify the $3k to tow the trailer there and back. 

About 18-20 months ago I and many others predicted a glut of used boats and RVs but none predicted the horrible economic conditions that we're experiencing. This has the makings of a bloodbath IMO. 

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demand is gone most people just dont know it as Q2 earnings are not out. i've spoken to a few multi billion dollar global sourcing execs... they are all putting massive halts on ordering more inventories and telling AP dept. to put STOPS on paying vendors. when vendors complain enough then they will pay or drag it out  Technically illegal but hey "they just forgot" ... all large organizations do this to free up cash flow. In fact some or a few ppls bonus depends on it. Stinks for small vendors as they will always get the shaft on longer terms, delayed payments from the big guys etc.. Delaying vendor payments for a few weeks can fre up 10s-100s of millions in cash flow. and right now wall street has shifted to rewarding cash flow. 

 Last 2 years cash was trash and now cash is king.

Sadly EVERY company i talk to large and small has the following problems:

1. They are VERY heavy on inventory whether in house or on order.

2 The Heavy inventory on shelf or on order has tied up all their cashflow and they are very cash/liquid POOR. 

3. Their margins are getting destroyed as all input costs have gone up way higher than what they were able to raise prices. 

4. Company outlooks are grim as follows:

    * Increased YTD sales , with lower than last yr profit

    * Similar YTD sales, lower than last yr profit. 

    * lower YTD sales, way lower than last yr profit

IMO the world economy has to crash: simply put there is NOT ENOUGH ENERGY to sustain current supply/demand situation. Whether stupidity, lack or labor, govnt decisions, war whatever you want to say or blame it on there SIMPLY IS AN ENERGY SHORTAGE so demand must drop in line. It takes ENERGY, FOOD, & LABOR to create EVERYTHING.... those input costs are still rising and fast while demand destruction begins leading us to stagflation for the next 12-24 months.

Yes there may be some items companies DUMP or reduce prices as they are starving for cash, but items that still need produced will continue to rise as they produce less of said item. 

Most food will increase by another 10-20% in the next 12 months. All the crop being panted with the 500% higher fertilizer prices, higher labor & energy costs are a long way from hitting the store shelves. 

Electrical grid shortages could raise costs by 20-50% in the very near term. 

Large corporations starting with Tech and soon mfg are going to enter layoffs very soon. That may or may not lead to slight labor cost reductions until the labor shortage becomes a surplus. 

FOOD , ENERGY, & LABOR are sucking all the disposable money away from avg Joe, and he will find himself 30-40% POORER than 2yrs ago very shortly.

 

Were in for a few hard years IMO.

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1 hour ago, The Hulk said:

demand is gone most people just dont know it as Q2 earnings are not out. i've spoken to a few multi billion dollar global sourcing execs... they are all putting massive halts on ordering more inventories and telling AP dept. to put STOPS on paying vendors. when vendors complain enough then they will pay or drag it out  Technically illegal but hey "they just forgot" ... all large organizations do this to free up cash flow. In fact some or a few ppls bonus depends on it. Stinks for small vendors as they will always get the shaft on longer terms, delayed payments from the big guys etc.. Delaying vendor payments for a few weeks can fre up 10s-100s of millions in cash flow. and right now wall street has shifted to rewarding cash flow. 

 Last 2 years cash was trash and now cash is king.

Sadly EVERY company i talk to large and small has the following problems:

1. They are VERY heavy on inventory whether in house or on order.

2 The Heavy inventory on shelf or on order has tied up all their cashflow and they are very cash/liquid POOR. 

3. Their margins are getting destroyed as all input costs have gone up way higher than what they were able to raise prices. 

4. Company outlooks are grim as follows:

    * Increased YTD sales , with lower than last yr profit

    * Similar YTD sales, lower than last yr profit. 

    * lower YTD sales, way lower than last yr profit

IMO the world economy has to crash: simply put there is NOT ENOUGH ENERGY to sustain current supply/demand situation. Whether stupidity, lack or labor, govnt decisions, war whatever you want to say or blame it on there SIMPLY IS AN ENERGY SHORTAGE so demand must drop in line. It takes ENERGY, FOOD, & LABOR to create EVERYTHING.... those input costs are still rising and fast while demand destruction begins leading us to stagflation for the next 12-24 months.

Yes there may be some items companies DUMP or reduce prices as they are starving for cash, but items that still need produced will continue to rise as they produce less of said item. 

Most food will increase by another 10-20% in the next 12 months. All the crop being panted with the 500% higher fertilizer prices, higher labor & energy costs are a long way from hitting the store shelves. 

Electrical grid shortages could raise costs by 20-50% in the very near term. 

Large corporations starting with Tech and soon mfg are going to enter layoffs very soon. That may or may not lead to slight labor cost reductions until the labor shortage becomes a surplus. 

FOOD , ENERGY, & LABOR are sucking all the disposable money away from avg Joe, and he will find himself 30-40% POORER than 2yrs ago very shortly.

 

Were in for a few hard years IMO.

I feel like I just read a sketchy news article on facebook. Sadly I think you're right about a lot of this.

FWIW, I definitely felt a little uneasy waiting to sell my old boat this spring. I still got good money for it, but now is only a matter of time before prices really start to reverse (on used) as people are likely much less willing to drop money on a ski boat. I'm not an economist at all, just thinking rationally. If I didn't have a boat currently, I think I would for sure be having second thoughts about buying one, or at least spending so much now.

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ahopkinsVTX

I’m not saying it’s not going to get tough and rough but this doomsday narrative has been spewed all of forum for two plus years now. Has some of it been true? Yeah, but it has never been nearly as bad as posted/predicted. I don’t know one manufacturer that is sitting on heavy inventory let alone light inventory. It’s still hard/impossible to find vendors that can supply on a pre Covid timeline for anything in our manufacturing business. Our net sales has been holding steady and our forecast from our customers is very strong. New programs are lined up, extensions in place for a lot of current programs. We’ll see. 
 

If the average joe becomes 20-40% poorer, we are all toast anyway. 

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People (myself included) have been predicting the recreation market getting slaughtered for the last two years, and it hasn't happened yet.

I really don't see the bottom dropping out of the used boat market specifically until there is a huge downturn (including pricing) on new.  Maybe interest rates will push us that way, but there just seems to be a lot of cash out there for these purchases.

Do people that spend $100k plus on a boat really care about $5/gallon fuel prices?  Especially when a lot of those same folks only have a season that is 4 months long.

Personally I expect a downturn in a lot of things, but I'm not sure the boating industry is going to see the worst of it.

And in what industry is there "heavy inventory"?  I certainly don't see it anywhere.

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1 hour ago, Jhucke said:

I feel like I just read a sketchy news article on facebook. Sadly I think you're right about a lot of this.

FWIW, I definitely felt a little uneasy waiting to sell my old boat this spring. I still got good money for it, but now is only a matter of time before prices really start to reverse (on used) as people are likely much less willing to drop money on a ski boat. I'm not an economist at all, just thinking rationally. If I didn't have a boat currently, I think I would for sure be having second thoughts about buying one, or at least spending so much now.

Used vehicles are dropping quickly, especially trade in values as we went to trade in a company f150  and decided to keep it instead based on the reduced price they were going to offer now vs beginning of year.. 

Saw a few articles on this as well.. tide has turned

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