WHO BUILDS WHAT BOATS?
Diversification is the name of the game. Whether companies sell cars,
soft drinks or sporting gear, the strategy is simple: appeal to a
wide audience by selling a variety of different products.
conglomerates like Brunswick Corp., Genmar Holdings and Tracker Marine
Group are a significant part of the recreational boating industry
and have dominated the scene ever since the economic recession of
the late 1980s forced many small boat builders to sell out or shut
down. A newcomer entered the field in late 2005, when industry veterans
Godfrey marine and Rinker Boat Co. announced they had merged.
and Tracker have succeeded because they build a model for nearly every
boater, in just about every price range and it is clear that the new
Godfrey/Rinker family hopes for similar results.
Case in point
is Brunswick. The self-described “world’s largest builder
of recreational boats,” this Lake Forest, IL, corporation has
long been synonymous with bowling and billiards, as well as other
boatbuilding empire began in 1986 with the acquisition of mainstream
marques Sea Ray and Bayliner. Over the next two decades the conglomerate
acquired a total of 20 boat companies in North America, as well as
Sealine Industries, the largest boat manufacturer in Europe. According
to information published by the company, Brunswick employs about 6,000
people, produces 543 different boat models, which are sold by hundreds
of dealers in the U.S.
For the third
quarter of 2005, despite the impact of Hurricanes Katrina, Rita and
rising fuel costs, the company announced a 13% increase in boat sales.
Net boat sales for 2004 totaled $2.3 billion. According to Statistical
Surveys, a Grand Rapids, MI, firm that tracks retail boat sales, Brunswick
controls over one-fifth of the fiberglass and aluminum boat markets
in the U.S.
To top it off,
owning Mercury Marine and MerCruiser means that Brunswick has a ready-made
market for its engines. But they are also sold to rivals Genmar and
Tracker, independent builders and retail dealers, which extends Brunswick’s
influence throughout the market. Though the company does not publicize
its market share, Brunswick posted $2.3 billion in net sales for engines
in 2004, a 23% increase over the previous year.
group also includes marine electronics systems, engine controls, Attwood
hardware and marine dealer management software.
second to Brunswick in boat sales, in recent years has carved its
own niche by pioneering two new types of boat construction methods
using VEC resin-injection and Roplene roto-molded polyethylene technologies.
The 250 boat models produced by 16 different Genmar builders range
from luxury motoryachts, like the Italian design Nuvari, to Carver
Yachts, Larson and Wellcraft runabouts and Four Winns deck boats.
held firm led by Irwin Jacobs was founded in 1978. It employs about
5,000 people and has a network of over 1,000 dealers in the U.S. and
overseas. Genmar owns no engine operation and thus equips its boats
with Yamaha, Johnson and Mercury outboards and MerCruiser or Volvo
In the mid-1990s,
the Minneapolis, MN, company and retailer Wal-Mart began co-sponsoring
professional bass and saltwater fishing tournaments with jaw-dropping
six-figure cash prizes, where even an angler in 50th place can go
away consoled with a prize of $10,000.
In 2004, Genmar
posted model year sales at about $1 billion. Genmar controls about
15% of the fiberglass boat market, but holds no share of the aluminum
boat market, having sold its companies to Brunswick in 2004.
Marine of Springfield, MO, is owned by Bass Pro Shops, Inc., which
has operated “big box” retail stores specializing in equipment
for anglers, hunters and campers since 1971. Ranking third in terms
of overall boat sales, Tracker sells around one-fifth of all aluminum
fishing boats and less than 10% of small fiberglass fishing boats.
The conglomeration owns Fisher, Mako, Nitro, SeaCraft, Tahoe and Myacht
houseboats. In 2004, the company acquired Travis Marine, which operates
about 30 boat dealerships and stores in the south, the Gulf Coast
states and the Midwest.
With their merger
in mid-November, Godfrey Marine and Rinker Boat Co. created what they
call the “fourth-largest pleasure boat manufacturer in the U.S.”
Marine industry statistics show that the two companies combined produced
over 10,500 boats in 2004.
about 500 people to build 17 different fingerless cruiser, cuddy cabin
and bowrider models and has gained high marks in J.D. Power ratings
in recent years. In 2005, prices ranged from about $28,000 for the
top-of-the-line Rinker 410 Fiesta Vee. Rinker Boats, which has been
in business at the same location in Syracuse, IN, since the 1940s,
boats that their “whole manufacturing process comes together
in one place in one town in the middle of the USA.”
culture shouldn’t change much. Godfrey Marine’s headquarters
in Elkhart, IN< is less than 30 miles away as the crow flies.
In business since
1903, Godfrey produces 300 different pontoon, deck boat, fishing boat
and pedal boat models in fiberglass and aluminum, ranging in price
from $500 to $75,000. The Elkhart, IN, company employees over 1,000
people at eight factories and has 500 dealer sin the U.S. and Canada.
Rinker boats are
fitted out with MerCruiser and Cummins inboards and Merc and Volvo
Penta I/Os. Power packages on Godfrey boats include Yamaha, Volvo
Penta, Mercury, Honda and Johnson and Evinrude engines.
In addition to
the conglomerates, the marine industry market is composed of a number
of significant independent builders like Chaparral, Carolina Skiff,
Crownline that hold their own in the top 10 list of fiberglass boats
sold. High-end builders like Cobalt, Grady-White and Cruisers dominate
in the over 24-foot market. Despite Tracker’s scope of builders
and models, Godfrey as an independent company, along with Alumacraft,
Bennington Marine, SmokerCraft and Triton, rank in the top ten of
all aluminum boats sold.
companies are able to keep their competitive edge by joining one of
three alliances or buying groups, the American Boat Builders Association
(including Chaparral, Cobalt, Regal, Rinker and S2 Yachts), the Independent
Boat Builders, Inc. (including Albemarle, Bertram, Crownline, Cruisers,
Godfrey, Maverick and Rampage) and the largest, United Marine Manufacturers
Association (including Albin, Carolina Classic, Freedom Yachts, Key
West, Parker, Sabre and Sylvan).
These groups allow
individual builders to take advantage of bulk purchase discounts to
obtain raw materials and OEM components like hardware, electronics
more than just purchasing power that can give smaller builders an
like Eddie Smith of Grady-White, Pack St. Clair of Cobalt and Linwood
Parker of Parker Boats are on the frontline when it comes to customer
service. Have a question about your boat? Call one of these firms
and you are likely to speak to a company executive. Want to visit
the factory while your boat is being built? Its president could well
lead the tour.
These days, fiberglass
powerboats tend to have a look that screams, “Stick with what
sells.” It makes sense from a business standpoint for the Big
Three to rely on tried and true designs, but sometimes aesthetics
can get left at the dock.
not all bad, however.
In the old pre-conglomerate
days, it wasn’t exactly every man for himself for boating consumers,
but construction quality, warranties and customer service were certainly
all over the map. Some companies offered exemplary service and products,
while others barely gave such considerations a nod.
may have suffered, accountability has gained.
and customer service philosophies tend to be consistent across the
board within the Brunswick, Genmar and Tracker families. The same
will probably hold true with Godfrey/Rinker. The independent companies
have more leeway, but still must be on a par with the conglomertes
to stay competitive.
overall tend to be higher. No longer are boats and engines sold with
one-year non-transferable warranties. Multi-year warranties that focus
on hull structure are the norm.
In addition, size
means that the conglomerates have the resources to go the extra mile.
For example, when Genmar purchased a number of boat building companies
following the bankruptcy of OMC a few years ago, the conglomerate
initiated a safety defect recall on hundreds of OMC-built Stratos
boats with hulls that made them unstable. Genmar also voluntarily
offered warranty coverage on certain OMC-built boats. The company
announced it was taking these steps as a means to gain consumer confidence
following the OMC bankruptcy.
So, from the consumer’s
standpoint, the competitive climate created by the conglomerates might
be likened to the proverbial high tide that raises all boats.
BoatU.S. Magazine, January 2006