Dealers?? Comparing your market

[kim cleckler]

Againist mine.. I have been here nearly 25 plus yrs i have never seen times as they are.. I have reduced inventory and also employees but the damnest thing i see is financing... We can't get any one bought you nearly have to be made of gold and silver plated.. If you dont have a 740 plus credit score no need to ask for a boat here in alabama..

Mercury and nearly all the rest dont have parts to stock with , the floor plan companies are making having inventory like we don't need them or they dont need us/ we go through a floor check every 5-7 days now... Then we get faxed copies after paid inventory and have to prove how the customer paid for it. Even after going home i get phone call from them wanting to discuss inventory and we have never been out of trust.... Make it hard to want tO be in the boat bussiness...

I was just wondering if any of the dealer on here are seeing what we are seeing here in alabama?

[Mark75H]

This is the way it was 40 - 45 years ago. Customers basically had to prove they had enough cash to buy a rig outright in order to finance one.

Boats and motors were a lot smaller and there was a reason ... it was all people could really afford.

[us1ss]

Kim, You haven't got any of the stimulus money over there yet?

[kim cleckler]

No,,,, obama has forgotten me... You got any yet?? ;)

[jtb]

Kim, You haven't got any of the stimulus money over there yet?

none over here either!
Floor plan is a bitch. we have never been late with a payment or had any strikes on our record. GE is putting the squeeze on us and making it where we won't/can't floor boats any longer.

[delawarerick]

Obama had the balls to memtion the boat and rv industry. Used is all about cash its less then 50cents on the dollar and here houses are even lower. Rick

[Top Banana]

The problem is the squeeze being put on the finance companies by the government. Remember the stress tests? That was basically to be sure that the banks had enough in reserve to withstand any losses that were coming. Now the banks that passed those tests and are trying to return the money, are being told the bar is now higher and they can't return the money. The government knows what is coming.

There are three legs that are collapsing. The first was the home real estate market, which began with sub-prime mortgages, that has happened, but will escalate further this year by the addition of prime mortgages, of the people who were good before, but are now un-employed.. The second is just starting, commercial real estate market. The third which won't hit until the end of the year will be the collapse of the credit card market.

Commercial real estate suffers when Joe and Mary no longer shop or eat out at the local strip mall or big mall. Pretty soon you see empty stores with For Lease signs and then the owner calls the bank and say....Sorry can't make the payment, don't have enough stores rented.

Credit cards are being run up now, as Joe and Mary who have always been good citizens....but are now laid off, really feel that they can find a job...maybe next week or the week after. As long as they believe it, they will contiue to use the credit cards to make up the shortage of cash they have. They believe that once they find that job, the cards will be paid down, but they are using them now. By year end they will realize...no job. The card companies will follow the real estate in a downward slide.

That is why the banks are being forced to build up reserves.....when all three go down, the banks may have runs on them like the 20's and the government doesn't want to deal with the aftermath of that.

By the way.....I really hope that I am 200% percent wrong on all of this, but history shows otherwise.

[greyally]

Kim, Im running into the same thing here-got alot folks wanting to buy euipment from us but banks arent lending money. If you dont have excellant credit and been in buisness for 20 years you wont get financed and even then there is no gurantee you will get money.

[jenksam]

Kim
out here it aint much differant. Textron sent out a letter about six months ago stateing that they would no longer be doing any floor planing in the boat,rv and golf cart end of things. The company has benn ther for 33 years and has never went passed the intrest date and never benn cought with out invintory.

As far as sales- cant sell a larger engine but the lil ones are going slow but at least they move. I cant keep a rebuilt or used engine. I see people want to go fishing but are not will to put out for a new boat or engine.

The biggest problem that i see is this ethanol. I hvae seen more problems that i belive to be related to this than anything else.

[Baja16]

Kim You guys a Evinrude Dealer???

[props4u2]

Same here with the banks. Until they lighten up the economy will stay on a down hill slide.


Lee

[WILDMAN]

I've been selling all the used boats and motors I can get. Selling lots of new 300XS motors too. Seven in the last few weeks! New boats are not selling too well though. Luckily, I have no floorplan. All my stuff is paid for, so I don't worry as much as to when they sell. I'm getting pretty bored now though because all my boats are rigged and ready to go. I don't have much to do now!

[Da Bull]

Alot of dealers jumped ship on new boat sales and now just do repair and mantanince. I have a bud that has a shop where he used to sell Mastercraft and Moomba`s but for the same reasons ya`ll said he ditched them and now stays booked up with just stern drive and direct drive repair and upkeep. No outboards at all.

DB

[delawarerick]

I received word yesterday that the biggest dealer in De is in trouble. This guy over the years has bought everybody out and has all major brands of motors. This would drastically hurt the econmy up there for he has a great deal of employees and vendors. Rick

[mrcrsr]

our sea ray yacht repair business has been doing well, and in the past couple of weeks, several of the brokerages we service that sell yachts have been picking up

[Mark75H]

I received word yesterday that the biggest dealer in De is in trouble. This guy over the years has bought everybody out and has all major brands of motors. This would drastically hurt the econmy up there for he has a great deal of employees and vendors. Rick

Yep, buying up all your competition by borrowing money is the "old business plan" Unfortunately those who are stuck with it (and that huge debt load) are on the way out. The employees and vendors will go elsewhere, as will the business. Sort of like cable companies thinking they had a monopoly when there will be competition from satellite and Fios forever ... Cable jacked up rates every year and continued to gain customers. Fios has burst that bubble, but the cable companies still have that debt from buying out the little guys.

Hard lumps for the guys who thought consumer credit would go on forever.

The smart kid mechanic who has a house he bought 6 years ago for $275k (and could have sold 18 months ago for $450k) and sells that house for $335k and moves back into his parents house for a few years will start a repair shop and employ a bunch of the people from the old dealership and keep some cash flowing into the vendors.

[Instigator]

that. When I was working at dealerships back in the late 80's (Ohio) we saw similar issues, though not this bad.
Floor plan checks went from monthly to every two wks or less.
Dealers were selling inventory out of trust and leaving in the middle of the night. Many horror stories told at the local ramps.

I was just up in Ohio last week and went past a few of my old dealers/customers. The ones that survived off new sales were all but closed.
The ones that survived off service were still there and appeared to be strong.
One of the dealers I worked for back in the 80's did as Wildman does and had no floor plan but carried a fair amount of inventory from 3 boat lines.
After the crunch of that era he cut way back and made the statement to me that the only ones to survive will be the smaller dealerships with low inventory that concentrate on servcie and taking care of the customer.
That statement seems even more accurate today.

As to the credit issue, I shopped aggresively for a pair of E-tec's a couple mnths ago and was told from multiple dealers that unless they were willing to co-sign for their customer,.......forget it!
I did read just recently that BRP had formed an agreement w/a lender to help them/their financing.
Gary

[Matt Gent]

Giving people credit on shaky credit history is what got us in this mess in the first place.

750+ credit rating isn't hard....just pay your bills.

Shouldn't be buying toys, and rapidly depreciating ones at that, on credit anyways. We'll be better off in the long run when people don't buy stuff they can't afford. Recreational and luxury industries are going to be affected the most because they benefitted the most during the crazy credit days.

[AirRide]

This is the way it was 40 - 45 years ago. Customers basically had to prove they had enough cash to buy a rig outright in order to finance one.

Boats and motors were a lot smaller and there was a reason ... it was all people could really afford.
LOL Yes..."In order to apply for a loan successfully, you must first prove to the bank, that you have no need for one". A little flashback from the 70's economic era for sure...:)

[Lanceonthelake]

Giving people credit on shaky credit history is what got us in this mess in the first place.

750+ credit rating isn't hard....just pay your bills.

Shouldn't be buying toys, and rapidly depreciating ones at that, on credit anyways. We'll be better off in the long run when people don't buy stuff they can't afford. Recreational and luxury industries are going to be affected the most because they benefitted the most during the crazy credit days.
Agreed

[delawarerick]

Yea but boats are a habit not a hobby. Back years ago when I worked for a dealer selling mainly pontoon boats and jet skis if you could sign your name and had a drivers licence there was a loan out there. Rick

[Brian Harden]

I actually have not had any trouble getting people financed. Got three deals approved already this week. I stopped using big companies like Bank of the West and Bank of America and now use a local bank with a Marine lending dept who actually has people you can talk to who actually know which end of the boat the engine goes on. Business in general has picked up considerably- 5 deals so far this week with 3 more days to go:cheers: Most of the deals are higher end pontoons and deck boats in which the buyers aren't as affected by the economy. Now if GE would just ....... nevermind:mad:

[Instigator]

Credit cards are being run up now, as Joe and Mary who have always been good citizens....but are now laid off, really feel that they can find a job...maybe next week or the week after. As long as they believe it, they will contiue to use the credit cards to make up the shortage of cash they have. They believe that once they find that job, the cards will be paid down, but they are using them now. By year end they will realize...no job. The card companies will follow the real estate in a downward slide.
Obama passed the credit card act protecting us citizens from sudden interest rate spikes, terms changes and other surprises but.........the credit card companies have 9 mnths before it goes into effect :thumbsup:
Wonder what they'll do during that time :rolleyes:
Anyone struggling for survival while living on cards will be done.

[AirRide]

I actually have not had any trouble getting people financed. Got three deals approved already this week. I stopped using big companies like Bank of the West and Bank of America and now use a local bank with a Marine lending dept who actually has people you can talk to who actually know which end of the boat the engine goes on. Business in general has picked up considerably- 5 deals so far this week with 3 more days to go:cheers: Most of the deals are higher end pontoons and deck boats in which the buyers aren't as affected by the economy. Now if GE would just ....... nevermind:mad:Things are look'n up! What kind of rates we talk'n?

[Brian Harden]

Have three more deals approved this week. All the rates have been 6.99 to 8.99% depending on amount down and credit score.:cheers: Hope everything continues getting better but starting to get nervous as gas climbs back to $2.50 in my area for 87 octane and 93 is at $2.70:mad:.