NMMA Economic Overview

NMMA Economic Overview  December 19, 2013
NMMA Economic Overview, formerly Boating News Net, is a monthly report on boating and economic markets featuring industry and general economic indicators that impact your business. 

U.S. Economic Indicators

Third quarter GDP growth was upwardly revised to 3.6% from 2.8%, primarily reflecting a greater pickup in inventory investment and a downward revision to imports. Offsetting these gains were slowdowns in consumer spending on housing, utilities, and health care. For 2014, economists with the NABE expect GDP to expand by 2.8%, an upward revision from previous forecasts. 
(Source: Bureau of Economic Analysis)

Consumer confidence fell again in November to 70.4 as both the Present Situation Index and Expectations Index turned down slightly to mixed reports. Meanwhile preliminary results the Thomson Reuters consumer sentiment survey indicates that confidence will rebound in December (by 7.4 points to 82.5), mitigating the decline seen during the federal shutdown. (Source: Conference Board)

CEO confidence gave up its previous gains and fell to 54 in the third quarter, reflecting declines in assessments of both current conditions and short-term outlooks. On the bright side, executives were generally more upbeat in their current assessments and outlooks for the Eurozone.
(Source: The Conference Board)

The unemployment rate fell to a 5-year low 7% in November with another 203,000 primarily private-sector jobs added to payrolls. YTD, 2.1M jobs have been added to payrolls, averaging 189K jobs monthly. The broader U-6 unemployment rate, which includes discouraged workers, similarly fell to a 5-year low 13.2% in November. Manufacturing payrolls posted gains for the past 4 consecutive months, with 63K jobs added YTD.

(Source: U.S. Census Bureau)

The PMI increased for the sixth consecutive month to a 2.5-year high 57.3 in November with significant increases in new orders, production, and employment. Prices also rose in November, although at a slower pace.
(Source: Institute for Supply Management)

Housing starts surged in November to 1.1M (SAAR), the first time since March that it’s surpassed the 1M mark . Home builder confidence continued to improve through December to 58 and has been over 50 for 7 consecutive months. New home sales were similarly strong in October, rebounding to 444K (SAAR). Meanwhile, existing single-family home ebbed in October to 4.5M (SAAR) after hitting a 6-year high in July. The inventory of available homes for sale corresponds to a 5-month market supply, maintaining upward pressure on prices.
(Source: National Association of Realtors, U.S. Census Bureau)

Boat Manufacturers Economic Indicators

Traditional powerboat wholesale shipments rose for the third consecutive month in September YOY for NMMA’s control group of manufacturers and were up 3.8% YTD. Skiboats, aluminum outboards boats, and fiberglass outboard boats remain bright spots (up 12.8%, 7.3%, and 6.7% YTD YOY respectively), representing the bulk of the market and offsetting slowdowns in all other boat segments. Corresponding dollars for all traditional powerboats were up 9.1% while average prices were up across all major categories, with increases ranging from 0.2% to 31.3%, suggesting a more expensive product mix relative to volume. 
(Source: NMMA MSR

Through the third quarter, new registrations of traditional powerboats were up 4.1% (R12M YOY). Sales grew in the third quarter ranging from 5.7% to 21.2% (YOY) for categories representing the bulk (91.6%) of boat sales. On a R12M basis, sales of fiberglass outboard, aluminum outboard, and ski boats remain strong, (up 7.5%, up 6.4%, and up 11.7% YOY respectively.) PWCs which account for 20.1% of all powerboats sold were up 2.5% (R12M YOY) while the R12M decline in cruiser sales moderated to -3.9% (R12M YOY) through September. Gains were offset by downward trends in sterndrive and jet boat sales (-8.4% and -30% R12M YOY respectively.) Sales across all regions improved in the third quarter on a R12M basis, moving up by 0.7 to 5.0 percentage points. Among high-volume regions, growth was led by the South Atlantic region (which spans the Atlantic Coast from Delaware south to Florida), up 8.9% YOY, and the East North region (including the Great Lakes states), up 3.9% YOY. Together, these two regions represent 40.1% of total new boat sales. Advanced data indicates shipments were up 6.6% through November (R12M YOY) in bellwether states for powerboats greater than 15’.
(Source: NMMA New Powerboat Registrations Report, Info-Link)

Recreational boat and marine engine exports were down slightly (-0.7% YTD YOY) through September, primarily reflecting weak exports during the first quarter (-6.5% YOY). On a rolling-twelve month basis through September, exports were up 5.0% (YOY), totaling $2.23B. Imports continue to show strength in September, up 10.3% YTD YOY. On a rolling twelve-month basis, imports totaled $2.1B (up 8.4% YOY). The strength of imports lowered the trade surplus to $108.3M, down -18.4% from the previous month.
(Source: NMMA Export/Import Abstract)

For more information on working with the news media on inquiries related to the state of the recreational boating industry, please contact NMMA’s Vicky Yu.

About American Boat Builders & Repairers Association (ABBRA)

Founded in 1943, ABBRA is a national marine trade organization that represents, is dedicated to, and seeks to strengthen and encourage professionalism in the boat building, marine service, and boat repair industry.