The marine market is heating up as OEMs make an entrance into the sector through acquisitions.
One reason contributing to the attention is that the economy is in a healthy place and consumers feel more comfortable making discretionary purchases, Brian Hinchman, vice president of wholesale finance at Yamaha Motor Finance Corp. USA, told Powersports Finance
“From a lenders perspective, we’re in the middle of a very strong economy right now,” Hinchman said. “These are all discretionary items that tend to trend up as the economy trends up as well so I think you can point to that.”
Several OEMs and financial institutions have entered the marine market over the last view months. Polaris Industries acquired luxury vehicle manufacturer Boat Holdings, making its debut in the market. BPR formed the BRP Marine Group after the acquisition of Alumacraft, a manufacturer of aluminum fishing boats. Union Bank and Trust, a subsidiary of Union Bankshares Corp., also sold its boat finance division for $400 million to Home BancShares.
After the economy crashed in 2008 during the Great Recession, the powersports industry has slowly climbed back up but has yet to reach the level it was before the crisis. While sales volume for motorcycles still hasn’t reached pre-crisis figures, consumer spending is high. The Consumer Confidence Index measured an 18-year high in February and has remained relatively flat in the months following as consumer assessment of the economy remains robust.
Additionally, the unemployment rate was 4% in June, according to the Bureau of Labor Statistics. That’s a slight increase from 3.8% in May, which was the lowest unemployment rating since 2000. Since powersports vehicles are a recreational purchase for the majority of the U.S., consumers pull back from the space when wallets need to be tightened. However, the strong economy means that consumers may have more dollars to spend, which is pushing activity in the marine sector.