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Speed On The Water
Regardless of how many key people you know in the high-performance powerboat industry and no matter how long you’ve known them, you are always on the outside as a journalist covering the market. Whether you’ve covered it for seven days or 17 years, as I have, that doesn’t change. No matter how well you think you have learned or think you know about their world, you are not—technically speaking—really in it.
So I keep that firmly in mind as I write this commentary from my cramped seat 36,000 feet somewhere above the middle of the country as I head toward the 2012 Miami International Boat Show. (If you want the perspective of true insiders, check out Jason Johnson’s “State of the Industry,” series, which ran on speedonthewater.com in January.)
But that distance, that I am not really “in” their world, is a good thing when it comes to having anything remotely connected to an objective perspective on it.
My take on the state of the high-performance marine industry is simple: It’s still tough out there. Gradually improving, but tough, as in tough enough to weed out a few more players even as things gradually improve.
My optimism is guarded, which is why I say gradually improve, because I talk to engine builders such as Mike D’Anniballe at Sterling Performance, who tells me his rebuild business is alive and kicking but his new-engine orders barely register a pulse. I talk to dealers such as Scott Shogren of Shogren Performance Marine, who tells me—and told you in Johnson’s excellent series—that his used-boat sales outnumber his new-boat sales “20 to 1.”
And while that’s great for folks selling used boats and boat owners freshening up their engines, boat builders don’t pay their bills on used-boat sales and engine rebuilds. New-model orders fuel the industry.
For all intents and purposes, the production-built go-fast powerboat market is dead. I want Baja, Donzi and Fountain to recover and succeed as much, perhaps even more, as anyone not drawing a paycheck from them. But the fact is those companies aren’t just getting sued for $61 million, they have filed for bankruptcy protection (the second time around for Fountain) and their court-appointed receiver has petitioned the Business Court of North Carolina for a sale of assets. (The filing is sealed, so no details are available in the public record.).
I’m not saying they can’t make a comeback. I’m saying it’s a long shot. I would love to be wrong.
The custom go-fast boat market has fared better in the past three-and-a-half years, but hardly without struggles. When I talked to Terry Sobo of Nor-Tech in late fall, he was concerned, to put it mildly, about the lack of new-boat orders. When I caught up with him a few weeks ago, he was buzzing with news of orders for new boats. And I heard the same thing from several other custom builders, all of whom agreed that while fall is traditionally slow and things traditionally pick up in the New Year, new-model orders in January 2012 were better than they were in January 2011.
On this, I trust them, because if the last three-and-a-half years has brought any positive change to the high-performance marine industry it is the death of posturing.
What am I talking about?
Three and a half years, ago I would call Builder A and ask him how it’s going. He would say, “We’re doing great, but I hear Builders B, C and D are about to go under.”
Then, being a diligent reporter, I would call Builder B and ask him how it’s going. He would say, “We’re doing great, but I hear Builders A, C and D are about to go under.”
That, my friends, is posturing and that—plus that my head wanted to explode after those two worthless phone calls—was the reason that calls to Builders C and D were unnecessary.
Now when I call Builders A, B, C and D they all say the same thing: “It’s tough. I think things are getting a little better, but it’s still tough.”
Another thing they all say? “We will never get to where we were.”
Tough but gradually improving, never to return to its peak—those are the things I am told by people on the inside. And those are things that ring true to me as someone on the outside.