Will 2010 soften industry’s tumble?

I’m sure there will be many interested observers at boat shows this winter — observing how few or how many boats sell.

It’s no secret that the boating industry had a bad 2009, which is sort of like saying the Washington Nationals had a bad baseball season.

Like many businesses, the marine sector took a hard hit during the economic downturn. Various reports I have read had sales off by at least 50 percent from 2008. And the domino effect was chilling. When boats didn’t sell last winter, motors didn’t sell, and depthfinders didn’t sell, and tackle sales were off.

It reminded me of the way problems in the faltering automobile industry created a tidal-wave effect throughout the economy, with lots of people down the line taking big hits.

Fishing tournament circuits were cancelled because they couldn’t find sponsors. Pro fishermen dropped off tournament circuits because their sponsors cut back on promotion budgets.

I have talked with people inside the industry who said the problem started with the inability of buyers to get enough financing to close the deal on boat purchases — as banks and other lenders tightened their belts in the wake of the mortgage industry problems. Depending who you talked to, the financing problem was more of a symptom of the marine industry’s problems than a cause.

Marine dealers across the Southeast were hit hard, and more than one fell by the wayside. The pages of this magazine bear out tough it was in 2009 — just compare the number of ads from marine dealerships with last year and two years ago.

Dealers weren’t the only ones hard hit. Eventually, a handful of boat manufacturers collapsed. I was channel-surfing in a Charleston motel room one night last year when I stopped on a CNN report about 300 workers being laid off by a boat manufacturer in Tennessee. Two web-sites I visited this morning both carried reports of how the bankruptcy filing of one mega-manufacturer was proceeding.

One thing I want to see is how many dealers stay home from shows, cutting the overhead they pay for floor space. And will the ones that still set up shop be taking up less room? Will prices reflect a smaller amount of competition among dealers, or are showrooms stocked so heavily that this year’s shows will amount to a fire sale?

Statistics indicate that consumers are turning a larger percentage of their money toward eliminating debt; their discretionary spending is off considerably. But industry observers point to a slight increase in home and auto sales through October, noting that boat sales usually mirror home and auto sales six months down the road. And they point to past recessions lasting 26 to 35 months before real recovery arrives. January 2010 is month No. 30.

I figure on attending at least four shows over the next two months. How they stack up against each other or to past shows will be interesting to see. Will location matter? For instance, a show scheduled for the first week of January in New Orleans has been cancelled. A show scheduled in a similar time slot in Kansas City will occupy 50 percent more floor space than it did last year.

Which way will the pendulum swing? It’s anybody’s guess, and fishermen and boaters will be watching.