How a serious boat shortage is rocking the industry.
The pandemic has popularized a lot of new phrases. “Reimagined events.” “Virtual learning.” “Social distancing.” Yet in the post-pandemic retail economy, perhaps the most common phrase is “back order.” Everything from bicycles to kitchen appliances to hot tubs has seen a surge in demand over the last year and a half, clearing out inventories and extending wait times for months, sometimes even years. One industry that has been particularly impacted is boating, which has left a distinct sinking feeling for many people looking to get out on the water this summer.
According to the National Marine Manufacturers Association, sales of boats, marine products and services saw a thirteen-year high in 2020, exploding by 9 percent and netting $46 billion nationwide. This February alone saw a 34 percent increase in powerboat sales, with other personal watercraft such as Jet Skis, pontoon boats and wakeboard boats increasing by double-digits. Entering the summer, the boating trend showed no signs of running aground—but is there enough supply to keep the market afloat?
As with nearly all segments of the economy, boat sales and production screeched to a halt when the pandemic first hit. Many boat manufacturers furloughed workers as they waited to see what was to come. Giant motor companies like Yamaha took a similar tack, shutting down their factories across the country “for as long as deemed necessary.” But then the warm weather came and throngs of people rushed outdoors to escape their quarantine fatigue. First-time boat buyers entered the market in historic numbers. Marinas bustled and boatyards became essential businesses. Despite boat shows being canceled across the country, orders for new boats powered on.
All of a sudden, the boat economy was riding an unprecedented wave of demand that boat builders couldn’t keep up with. As more orders piled up, supply chain interruptions due to COVID-related factory closures sent shockwaves through the industry. Any time a factory worker tested positive for the coronavirus, the plant closed for at least two weeks. More recently, freak events have only heightened the wave of demand. In February, Texas’ hundred-year deep freeze shuttered factories responsible for creating the chemicals for seat cushions in boats. When the 220,000-ton tanker Ever Given ran aground in the Suez Canal this March, critical components such as flooring, electronics and handles were stuck behind it. The result has been a boat production bottleneck with no end in sight.
“It’s really been the perfect storm disaster for consumers,” said Mike Allen, the owner of Tidal Creek Boatworks, “with lean manufacturing and high demand.” As one of the most prominent boat builders on the island, Allen already had a two-year waiting list for his boats, but the pandemic has made completing those already in production a challenge. “The biggest issue is getting engines,” he said. “The next biggest is getting electronics. You have to be really creative in sourcing parts.” Components that used to take Allen five minutes to order can now keep him on the phone for two hours, sometimes just to end up on a back order list. At press time, Allen was about to complete three boats that were all missing arguably the most important part. “We’re on pins and needles waiting for engines,” he said. “We have boats that are going to be done without engines…and that never happens.”
This past winter, Allen expanded his operation by purchasing Brant Point Marine on 32 Washington Street where he opened Tidal Creeks Ship Store. Along with selling electronics, fishing gear, safety equipment and other nautical supplies, Tidal Creeks Ship Store is a Zodiac dealer; however, these days you’d be hard-pressed to find a Zodiac on Nantucket. “Zodiac is completely sold out,” Allen said. “They’ve been sold out since January.”
For one desperate Zodiac buyer, who purchased his boat directly from the manufacturer, he was told that the boat originally scheduled for last February would not be available until this coming fall. Not to be denied, he sourced his own engine in Florida, had it shipped up to the dealer in the Northeast, and instructed Zodiac to ship the boat in pieces to an on-island boatyard that proceeded to assemble it by hand.
Roger Stolte, the owner of Glyn’s Marine on Arrowhead Drive, echoed Allen’s lament over the lack of engines. “Repower is a large part of my business—putting new engines on older boats,” Stolte said. “But we’re completely unable to get outboards. I placed an order last July and I’ve only seen a third of that order.” He’s not expecting to receive his more recent orders until the spring of 2022. And yet despite this lack of inventory, Stolte and his team are as busy as ever servicing boats gearing up for the season. In fact, he doesn’t believe the regular boating public on Nantucket will experience any noticeable changes this season compared to last. The harbor and moorings are already maxed out. “Even if everyone who wanted a boat on the island could get a boat, we’re dealing with a limited area to put them,” he said. “The proverbial five-gallon bucket is full.”
For those unable to buy a boat—new or old—the next best thing is renting one. KellyBoat is a New England-based company that helps yacht owners rent out their vessels when they’re not being used. “Think luxury Airbnb for lonely yachts,” described KellyBoat’s founder Kelly Shea, a former lawyer who hatched the idea for her business when a friend asked how they could gain access to some of the yachts they were admiring in Nantucket Harbor. The inventory collapse has ignited incredible demand for these rental boat brokerage services. “Several owners sold their vessels last year and ordered a new one [but] the new boats have not arrived and in some cases may not before the season ends,” she explained. “Now, these owners are looking to get out on the water while they are waiting on their new boat, and guest demand is higher than ever with the end of COVID restrictions.” Waiting on their new boats, yacht owners are not only missing a season on the water, but also the potential of earning some money by renting out their yachts through services like KellyBoat.
As with all booms, the supply/demand imbalance should correct itself over time, but it may take several seasons for the market to normalize. For those who dream of hopping on a new boat and sailing off into the sunset, they’re realizing that their dream may be anchored in the reality that they will have to wait until the tides change once again.