CHICAGO — After a slow start resulting from a harsh winter and cold spring, the recreational marine industry is experiencing accelerated growth, says GE Capital, Commercial Distribution Finance (CDF). Retail and wholesale sales are up versus a year ago in the U.S., and the industry is on track to reach the 8% growth in retail dollar sales originally forecast in February by CDF at the Miami Boat Show.
“We finance more than 2,000 dealers in our marine business, and we see them moving a lot of product at the retail level,” said Bruce Van Wagoner, president of CDF’s marine group. “We have no reason to think the industry won’t hit or even exceed 8% growth this year.”
Through June, retail boat sales are already up 4.8% excluding personal watercraft (PWC), and up 9.5% including PWC, according to early reporting data from Statistical Surveys, Inc. (SSI). For this same time period, wholesale financing volume at CDF is up 13%, dealer inventory turnover is over 2X, and aging rates, reflecting inventory over one-year-old, are down 2%.
“These strong inventory turns and low level of aged inventory are the best we’ve seen in 20 years,” said Ed Bragg, vice president of manufacturer relations for CDF’s marine group. “This data underscores the broader health of the market place and also shows the disciplined, prudent business practices which provide a good foundation for further growth.”
“The marine industry can obviously benefit even further if the economy accelerates, but it also has to be prepared for every economic scenario,” Van Wagoner noted. “Both manufacturers and dealers have done an excellent job of riding out the ebbs and flows of the economy in recent years, and today the industry is again vibrant.”
CDF, which has been in the marine industry for more than fifty years of business and economic cycles, offers customer-centric new and pre-owned floorplan programs that enable marine dealers to stock a broad selection of products. Inventory financing, also known as floorplan financing, is an important element of a successful manufacturer-dealer business model. CDF has long-term relationships with marine customers, including over 500 dealers who have been customers for at least 20 years.