Rising Fuel Prices Could Dampen Growth In Boat Sales
Written by Claudio Mendonca on March 31, 2005
By Claudio Mendonca
Pleasure boat sales are rising, but clouds are on the horizon. High gasoline costs could propel boaters to seek alternative fuel options, some dealers say, and condo construction is displacing marinas.
"Boat sales in general are up, but dramatic fuel prices are keeping business down a little," said Bob Everhard, owner of 22-year-old Florida Yacht Charters and Sales, where an increase in sailboat purchases has outpaced powerboat sales.
Although powerboats have been "consistently better" sellers over the years, Mr. Everhard said, 60% of the sales in his Miami Beach dealership now are sailboats.
In the long run, skyrocketing gas prices may cause consumers to seek alternatives, said Phil Pradel, owner of the Boat Center, 18300 S Dixie Highway, in Cutler Ridge.
"Sales of powerboats can be affected, especially with fuel prices doubling from last year and boats consuming hundreds of gallons," Mr. Pradel said.
As gasoline prices soar, he said, consumers are looking into technologies such as boats with 4-stroke outboards resembling automobile engines. According to industry professionals, this new technology is more fuel-efficient, cleaner, smoother and, as a result, quieter.
It costs about $8,400 to replace the traditional two-stroke engine with the new four-stroke, according to the National Marine Manufacturers Association. In 2003, 305,400 outboard motors were sold, the association says, compared to 302,100 in 2002 and 299,000 in 2001.
During the 1970s oil crisis, Mr. Everhard says, boat sales plunged when many customers didn’t have access to fuel.
"There were historical records and people were afraid they were not going to get gas," he said.
Unlike other dealers, rising fuel prices haven’t altered his business at all, said John Vlad, president of Dixie Marine at 21500 S Dixie Hwy. As the matter of fact, he said, so far this year sales are triple the same period last year at Dixie Marine, where consumer favorites are 17- to 33-foot Seacrafts, Makos and Seapros.
And high gas prices didn’t affect boat usage last year, said the director of marketing statistics of the National Marine Manufacturers Association, James Petru.
"We didn’t see anybody backing away from using their boats last summer," said Mr. Petru, and 2003 sales rose 4% increase from 2002. "From what I hear, first quarter sales have been fairly good."
The executive director of the Marine Association of South Florida, Frank Herhold, agrees.
"The cost of fuel is not going to be a serious deterrent for purchasing nor usage," he said.
At Marine Max, 700 NE 79th St., district manager David Witty said sales are up about 20% from last year. He said he doesn’t believe high gasoline prices will influence sales for the remainder of the year.
"We have actually been extremely active and are doing well across all of our lines," Mr. Witty said.
In addition to higher fuel prices, industry professionals worry about condominium construction displacing marinas.
"Our major concern today is the disappearing spaces for dockage and service yards," Mr. Everhard said. "As Florida grows, condominiums are eating up the few remaining marinas."
Marinas in Aventura, North Miami Beach and Key West have been diminishing in size, if not disappearing, Mr. Everhard said.
Mr. Pradel also showed concern about vanishing of marinas.
"Miami is running out of places to store boats," he said. "Currently, there are very few marinas versus the amount of boats."