More Americans took to the water in new boats this summer, often buying smaller, less expensive models, as the industry is showing signs of a recovery.
Bloomberg reported that purchases of powerboats — which include yachts, pontoons and fishing vessels — rose 18.9% in July from a year earlier, according to figures from Statistical Surveys Inc., a research company based in Grand Rapids, Michigan. Even with mild summer weather and a cold winter, year-to-date sales are up 3.1%, the data show.
The industry “is performing pretty well again” after bottoming in 2010, with smaller boats — those under 30 feet in length — showing particular strength, said Tom Walworth, the company’s president. This category has rebounded about 13% since 2010, outpacing the 9.3% growth rate for larger craft, a sign there’s been a lasting shift in consumer preferences since the 18-month recession ended in June 2009, he said.
“What really stands out in the economic recovery thus far is that demand for smaller boats is coming back pretty nicely,” said Michael Swartz, an analyst with SunTrust Banks Inc. (STI) in Atlanta. That’s partly because “very lax” lending standards before the recession have become more restrictive, so people are buying what they can afford, he said.
Boat purchases are highly correlated with consumer confidence and gross domestic product, according to Thom Dammrich, president of the National Marine Manufacturers Association in Chicago. Sales aren’t near the previous peak yet because the economy is growing only modestly and the industry performs best when annual GDP exceeds 3%, he said.
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