Are sterndrive runabouts coming back?
With the March issue heading to the printers, I’ve started working on my next Market Trends feature that seeks to answer crucial questions about the sterndrive category: are sales ever going reach their previous heights? And if not, is that a problem for the marine industry?
A lot has happened since the early 2000s in the marine market, but one of the most significant shifts is the flip-flop in popularity between outboards and sterndrives. The industry has also born witness to the dramatic rise of pontoons, as they’ve quite swiftly ditched their dowdy image and become fashionable. Then you’ve got frightening increase in cost for most fiberglass boats to contend with, which undoubtedly has to be a factor for people that can’t afford to drop $80,000+ for their weekend recreation.
As I’m learning, the oft-mentioned “decline of sterndrives” may not be so simple, as there are real sales differences in the category depending on size. Larger sterndrives are doing well, I’m told, while it’s the lower end of the market that’s struggled to gain traction.
I am gathering industry data for my story, as well as interviewing OEM heavy-hitters in the sterndrive category for their thoughts on where these trends are leading. Aside from the expected corporate optimism, I’m hoping my sources open up and speak frankly about the category’s present and future, as well as sterndrive segment’s prospects going forward.
High-tech and high-powered outboards engines have changed the industry, and consumers in specific categories seem to be showing a preference for independent propulsion. The Baby Boomers are retiring and usage surveys that show most boaters spending more time docked — two big factors feeding the movement toward pontoons.
So is the sterndrive runabout category as unhealthy as it seems, or is it poised to roar back? The answer is likely somewhere in the middle. Some industry officials suggest we’re seeing a generational shift in boaters that’s here to stay, while others disagree. Now it’s time to see what the real sterndrive experts have to say — stay tuned.
Hi Tom,
In response to your information gathering about stern drives, here are my thoughts.
Sterndrive boats have changed little in appearance or functionality over the last 30 years. They have always had a bad reputation for reliability and operating costs. New ones with catalytic converters are more complicated and potentially more expensive to get fixed, but they work pretty much the same. Used ones are very similar to new are at a fraction of the cost. What motivation does a person have to buy a new sterndrive boat?
In the Boating Industry 2013 Webinar http://epgmedia.s3.amazonaws.com/web/boatingindustry/webinar/2013-BoatingIndustry-StateoftheIndustry.mp4, it was noted that 85% of first time buyers buy used boats and that the old fiberglass isn’t going away. If 85% is the average, I’ll bet it’s over 90% for sterndrives. The first time buyers buying new boats are no doubt concentrating on new boats with outboard motors, because new outboards are much better than those of a few years ago. In the smaller sizes people have the option of just buying a new outboard motor for their old boat or for a used boat, but 30-foot boats that are built for 3 or more 300hp outboards are a new niche that is still being filled.
As you noted, the new larger sterndrive boats are doing better, which I believe is at least partly because they incorporate innovative controls, like joysticks controlling twin sterndrives. Also, the people with money to buy boats are now more concentrated in income brackets that would naturally buy a larger boat. The middle class boater is increasingly a used boat kind of guy.
The latest jet boat runabouts have a lot of advantages over sterndrives. They are familiar to buyers whose first boat was a PWC. The jets cost less, are easier to drive, harder to break, and won’t chop up your kids. This peace of mind makes it a lot more fun on the water.
Buying a recreational boat has always been an emotional decision. Even in the late 80’s, when the unit sales of sterndrives peaked, I remember a Bayliner study found the average time on the motor of a $20k boat was about 28 hours/year. There’s always had to be something new and exciting to motivate the purchase of a new recreational boat. Sterndrives just don’t have it.
Worse yet, social media and the pace of technological advances are blamed for making more people more excited about new experiences, which are crowding out the old comfortable ones. The innovators and early adopters addicted to new technology have risen from the historical 16% to 56%, which can’t be good for the old sterndrive.
This article “Study: Majority of U.S. adults call themselves early adopters of new technology” notes that 56% of people 18-44 now identify themselves as early adopters. The article attributes the growing focus on innovation to rising social media.
http://www.geekwire.com/2014/study-majority-americans-now-early-adopters-new-technology/?utm_source=GeekWire+Daily+Digest&utm_medium=email&utm_campaign=ac42ed89d4-daily-digest-email&utm_term=0_4e93fc7dfd-ac42ed89d4-233319605
So to answer your questions, sterndrive sales are unlikely to reach their previous heights, particularly if there is any innovative competition. And since the sterndrive boat segment has long been the industry’s most valuable segment, it’s demise is a problem for the industry, unless an innovative technology comes along to excite buyers.