Boat Builders

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Industry Structure, How Firms Opertate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Quarterly Insight, Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 850 boat builders in the US design, manufacture, and market boats used primarily for personal and recreational purposes. Major product categories include power boats, sailboats, kayaks, canoes, and rowboats. Power boats include boats with inboard, outboard, stern drive, and jet powered engines. The power boat category includes Personal Water Craft (PWC), such as a jet ski. The retail price for a new fishing boat ranges $25,000 - $100,000, but luxury yachts can retail for millions of dollars.

Variability in Costs

Variability in the cost of materials and components affect margins and profitability for boat builders.

Competition from Used Boats

Boat builders compete with the used boat market, which appeals to deal-seeking buyers and new boaters looking to minimize their investment.

Industry size & Structure

The average boat builder operates out of a single location, employs about 50-51 workers, and generates $12 million annually.

    • The boat building industry consists of about 850 firms that employ about 43,200 workers and generate almost $10 billion annually.
    • The industry is concentrated; the top 50 companies account for about 74.5% of industry revenue.
    • Large companies include Brunswick, Bombardier, Viking Yacht Company, and Marine Products Corporation. Some large companies have international operations.
    • The US became a net importer of boats in 2015.
                              Industry Forecast
                              Boat Builders Industry Growth
                              Source: Vertical IQ and Inforum

                              Coronavirus Update

                              May 14, 2022 - Electric-Powered Power Boats
                              • The future of recreational boating is electric. The boating industry is introducing electric powered boats (EBs) and motors, according to Axios. The Arc Boat Company in March launched the all-electric Arc One, a 24-foot cruiser developed from scratch to address the challenges posed by battery-operated boats. While electric boats are easier to maintain, cleaner to operate and quieter, they’re also heavier than traditional boats because they’re powered by a very large battery, which reduces their speed, according to Axios. The EB is also very expensive: The Arc One will sell for about $300,000, about twice the price of typical premium sports boats, Axios reports. Mercury Marine, whose engines power about half of all recreational boats in the US, recently introduced the first of five new electric outboard models coming by 2023.
                              • While the average age of boating customers has always been in the middle-age range, the median age is increasing as younger people opt for other recreational activities. Currently, the median age range is just over 50 years. Unless boat manufacturers are able to target a non-white market, this trend of aging boat buyers will gradually increase, according to Linchpin SEO’s report on Boating Market Marketing & Industry Trends Shaping 2022.
                              • A new trade deal between the US and UK will eliminate retaliatory tariffs on US exports to the UK, including those on American-made boats and marine engines, according to Boating Industry. The tariffs in place since 2018, led to a 25% upcharge on industry products shipped to the UK and resulted in a 60% decline in exports to the country. In exchange, the trade deal eases US tariffs on aluminum and steel imported from the UK. Lower priced raw materials are also good for the boat manufacturing industry.
                              • Boat builders expect sales to increase in 2022 as they work to keep up with strong consumer demand and fill orders. Combined shipments of boats, engines, and trailers increased 1.6% in January 2022 compared to a year earlier, according to the National Marine Manufacturers Association. Top categories driving growth were personal watercraft, up 38.3%, and boat trailers, up 37.4%.
                              • Supply chain issues will likely continue through mid-2022. According to Jim Snabe, chairman of German conglomerate Siemens and Danish shipping firm Maersk. Right now, we have congestion primarily in the West Coast of the US where the ports are full of containers." One of the main issues, Snabe said, is there aren't enough truck drivers to pick up containers from the ports. Ships were waiting an average of 18 days in front of ports in late November, Snabe said. "That takes capacity out of the shipping industry because they are lying there idle," he said. "You have higher demand and lower capacity, not because we don't have enough vessels, but because they are not sailing because of congestion," Snabe added. "We have to balance that out. We think this will happen somewhere mid-next year, but maybe not before."
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