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COPYRIGHT 1999 Ehlert Publishing Group
The Boating Business
When measured in terms of sales revenue, the recreational boating industry shrunk 3 percent during 1998, according to data gathered by the National Marine Manufacturers Association (NMMA).
After adjusting for inflation, total industry revenue declined to $14.3 billion in 1998, compared with $14.8 billion in sales during 1997, the NMMA reports.
Despite the decline, 1998 was the second best year for the industry during the 1990s. 1997's $14.8 billion in sales was the industry's highest in the 1990s. However, the industry still is not close to the glory days of the 1980s. For example, the 1998 sales total was 16 percent below the industry's 1989 total revenue figure of $17.1 billion.
The NMMA data adds weight to the view held by many in the industry that 1998 was a disappointing year, given the general strength of the US economy.
The national economy, as measured by the gross domestic product (GDP), grew at a relatively robust annual rate of 3.7 percent during the July-through-September portion of 1998, according to the US Department of Commerce.
However, during the second quarter - the most important time of the year for the boating industry - the national economy grew at a relatively anemic rate of 1.8 percent, which helps explain the industry's disappointing results.
The lukewarm economy during the second quarter followed a strong first quarter of 1998, when the GDP grew at a 5.5 percent rate.
The boating industry sales revenue declines did not occur across all product categories, a further examination of the NMMA data reveals.
There was a sharp decline again during 1998 in sales of personal watercraft (PWC), both in dollar and unit volume terms, providing more evidence that the popularity of PWCs peaked in 1995.
Specifically, PWC sales revenue declined almost 24 percent to $868.5 million and unit volume was down 26 percent to 130,000 PWCs sold during 1998, the NMMA reports.
Another major category, outboard boats, provided mixed results with sales revenues declining 4 percent to $1.36 billion, and unit volume increasing almost 1 percent to 200,900 boats in 1998.
While the outboard boat market was lackluster in 1998, the outboard engine segment did better, suggesting the engine replacement market was healthy.
In dollar terms, sales of new outboard engines - both for replacing worn-out engines and the new engines sold along with new boats - increased nearly 8 percent to $2.16 billion. In units, outboard engine sales increased 4 percent in 1998 to 314,000 units, compared with 302,000 engines sold during 1997.
The declines in PWC and outboard boat sales revenue were somewhat offset by revenue increases recorded in certain smaller product categories, the NMMA reports.
Except for jetboats, the dollar value of sales increased from 1 percent to 18 percent between 1997 and 1998 in the other categories tracked by the NMMA.
The...
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