Recreational Boating Demand to Increase 9.3 Percent Annually Through 2014

The short-term outlook for the boating industry remains clouded; however, despite these challenges the recreational boating market (including boats, propulsion systems and accessories) will rebound from its depressed 2009 levels, with demand rising 9.3 percent annually to $10.1 billion in 2014.  Demand will be driven by gains in consumer spending and disposable income, while the recovery in financial markets will enable more consumers to buy boats on credit.  Growth in the 55-64 age bracket will also support demand, since boat purchases become more likely just prior to retirement (although they tend to decline thereafter) and consumers in that age group have the disposable income to purchase larger, more expensive vessels.  In addition, the industry’s effort to market the “boating lifestyle” to women and minorities should expand the market.  However, even with the rapid sales growth, the market is not expected to recover to the pre-downturn levels until the end of the decade. These and other trends, including market share and product segmentation, are presented in Recreational Boating, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.

Boating products are luxury items, often purchased on credit or by borrowing against the value of a home, and therefore the recreational boating market was decimated by the economic downturn in 2008 and 2009.  For the boating industry, these factors combined to not only reduce consumer spending and the ability of individuals to secure credit for boats, but also meant that many boat dealers had trouble obtaining financing to purchase boats for their stock and boatbuilders could not borrow to pay for materials or their long-term debt.  As a result, the 2008 and 2009 economic downturn provoked the worst recreational boating industry contraction in nearly 50 years, with a sharp drop in demand and a number of bankruptcies among participants.

Demand for recreational boats is projected to increase 10.2 percent annually to $6.5 billion in 2014, benefiting from the economic and credit market recoveries as well as dealer restocking and pent-up demand from consumers who delayed purchases during the downturn.  Powerboats are expected to see the fastest gains in the boat category, after recording especially sharp declines in 2008 and 2009.  Demand for powerboats will be supported by technological advances including newer propulsion systems and more advanced electronics.  The aging of the population will also support gains, since powerboats are less strenuous to handle and maneuver than sailing vessels.

The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually. This industry analysis provides an unbiased outlook and a reliable assessment of an industry and includes product segmentation and demand forecasts, industry trends, demand history, threats and opportunities, competitive strategies, market share determinations and company profiles.