Exactly! Boating is really a BARGAIN when you think about it, and it is very tough to beat as a family activity. I grew up boating with my parents and 3 brothers and a sister. Rather than everyone going all directions every weekend, we were in our 20 foot Formula doing a lot of skiing, fishing and camping. Great memories! Now we ALL have boats and get together most every weekend in the summer along with all the cousins, nieces and nephews! Gas prices will not slow these families down. I bought a new Formula in 2005, one brother bought a new Montere in 2007 and another brother and my sister are in the market for new boats right now!

Oh, forgot... Another side benefit is during the crappy winter months during the holidays we all bring our boating videos from the year prior and watch them!

Too many people look at oil profits in dollars, not percentages.
Shell only made 7.5% profit last year. In my business that sucks.

Furthermore, it is the American public who have voted in officials
who support fanatic green agendas that prevent the oil companies
from even entertaining re-investing profit in developing new abundant
sources of oil.

Get over it America, the price of oil is only your own fault.

Pesky Varmint

The boating industry will surive. However, the herd will be thinner.

[QUOTE=Pesky Varmint;2546504]Too many people look at oil profits in dollars, not percentages.
Shell only made 7.5% profit last year. In my business that sucks.

7.5 % sounds great to me. In the Construction Ind. you get 3 to 4%, after overhead, ins. and all the BS, workers comp. etc.
The key is that 7.5% is on many billions.
The more "volume" or sales, the less percentage you can get by. I rather do 5 mill a year at 3% then 3 mill at 5%.
Next year.. I'll be lucky at 1.5 Mill at 4%

I was on the phone with a very well known industry person last night and the outlook is not good. In their opinion when this is all said and done there will only be 3 or 4 strictly performance builders left standing.

Costs have gone into outerspace and demand has pretty much stopped for new product. One large mfg has 50-75 new boats sitting at the factory. Though there are dealers that are strong and can stay "afloat", many are on the edge right now.

This is the ISSUE - since we are at the beginning of this cycle, some are still riding, sliding and hoping for the turn-around.

What if the turnaround NEVER happens?

I am sure there was a time when Covered Wagon sales were down and they were waiting for the turn-around, and guess what happened?

Evolution. Times changed. How many Covered Wagon companies survived? Yes, the stronger builders will survive. How many are there? One? How many years can they wait it out? Let's just say Outerlimits is the company to hang in there because of strong sales to date. Can they just sit and sell only 2-3 boats a year until the turn-around happens?

And then it may turn into something like the Rolls Royce market on the water where there is only enough market share for one, maybe 2 to builders to compete.

Just thoughts.

You can hardly compare the construction industry to the oil industry. What R&D does the contruction industry do? About none. What investment in plant and equipment does the construction industry have? They don't even have plants that need to upgraded and replaced. Does the construction industry have to sink millions into a well that could produce nothing? No, they just bid on a job, build it, and collect the money. It's a low risk business. That's why the margins are low. Just about anyone can get a contractors license, and get into construction.

Michael

Construction is a "low risk business?" I am sure a few contractors on this board would disagree with you on that one. There are a few more variables that go into it than just bidding and collecting money. You are right, just about anyone can get into the business, and they can be the low bidder on every job they want to. But you don't go broke from the job you don't get. It's the one you dropped your pants for that you "bought" just to get work and keep cash flow going that puts you out of business.

Restaurants have the highest rate of business failures. Contractors are second.

Having spent my entire career in the surety industry (guaranteeing the performance of contractors), I can assure you that it is a risky business.

Few notes..
I dare ANYONE to get a CGC license in FLA (or CA) and pass all the exams. Hurrican codes and siezmic codes.
The industry is extrimely risk oriented. OSHA, lieb ins. etc. One little incident and out of business you go. One little mistake on the contract and out you go.
A few days in delays and liqudated demages,, and out you go. And on and on.. as far as R&D. The Construction Ind, leads just about everyting ion R&D. Cement plants, admixtures, adhisives, fasteners, methods. AC. Heating, Software, alarm. FP. roads, bridges and all the equipment, trucks dozers. etc. etc.. we have invested to do a low margin work. I can go on and on, but I won't. The comment you made shows that you have no clue about the Construction Ind.
And who do you think does the drilling for the Oil Companies?? Contractors.. and no doubt it can be a successful and lucrative business. But the risks are a lot higher then anyone realize.

I agree with an earlier post. There will be a consolidation in boating period. The performance market will end up with 3-4 V builders (Cig, Outerlimits, Nortech, Active Thunder) and three or 4 cat builders (Skater, MTI, and Nortech). I pick these builders for 1 of 2 reason, strong international and government contract business, and two great economic models.

The productions guys like Foutain and Donzi are in real trouble because they count on volume to make a margin (first death was Baja). I also expect for the industry to go more factory direct, just in time ordering model, and less reliable on the dealer caring inventory.

As for me, I will keep boating as long as it doesn’t affect my life. I am very blessed and fortunate enough to ware it hasn’t affected me at all, yet.