The maritime economy has not been in good shape in the city which calls itself “the sailing capital of America”.
The slump that calmed the nation’s powerboat and sailboat industry four years ago hasn’t spared Annapolis — or the two boat shows that have docked in the harbor every October since the 1970s.
But this year is different, say local boating experts. Consumer confidence is returning and more and more boaters want to buy a new boat or trade in for a bigger one.
“The challenges have been serious,” said Paul Jacobs, general manager of the US Sailboat Show and US Powerboat Show. “We’ve only been talking for the past few years, but we’re ready to walk. The industry is coming back. People are responding.”
Gary Reich, editor of Annapolis-based Prop Talk magazine, agreed – at the top to a point.
“It’s so much better than two years ago. There are many signs that things are improving, but I don’t think we’re there yet,” he said. “There’s a lot of optimism, but it’s cautious optimism.”
There’s reason to be cautious: While the domestic industry saw a surge last year in powerboat and accessory sales – the first since 2006 – Maryland saw a double-digit decline, according to the Chicago-based National Marine Manufacturers Association.
According to the association, Maryland was one of only six states to experience a decline in retail sales of powerboats and accessories in 2011. Total spending fell 11.6% to $162 million. down from $183 million in 2010. About 4,600 fewer boats were registered in the state in 2011 than in 2010, the eighth consecutive annual decline.
Some blame Maryland’s excise tax on boats, which is higher than that of surrounding states. Others say the drop could reflect poor environmental conditions in the Chesapeake Bay or the drop in fishing license sales in recent years.
Maritime business people are hoping the two Annapolis boat shows, combined with this weekend’s Trawler Fest in Baltimore’s Inner Harbor, will get things moving again. Sailboat enthusiasts will fill City Dock from October 4-8, while powerboat enthusiasts will take over from October 11-14.
The two events, billed as the oldest and largest boat shows in the country, will begin to take shape on Monday. Workers will install a mini-city consisting of 1.5 miles of floating docks, 250 tents, six miles of electrical wiring and 15 miles of pipes.
“We’re like high-tech carnival workers,” Jacobs said.
Annapolis officials estimate the boat shows will attract up to 100,000 visitors, with an economic impact of more than $50 million. It’s music to the ears of the city’s $155 million-a-year marine industry, which does everything from designing and building elite recreational and racing boats to repairing them. and their accommodation.
The poor economy has forced boating businesses to branch out and offer other maritime services, local business operators said.
“The [companies] who survived are those who focused on quality service,” said Geoff McCord, general manager of Annapolis-based Bavaria Yachts USA.
The industry has also done a lot of soul-searching.
“There was a lot of upheaval. Companies were buying up and boat molds were changing hands,” Jacobs said. “Now they’re saying, ‘Let’s go in and build boats. “”
Last year, U.S. retail sales of recreational boats, accessories and marine services rose 6% to $32.3 billion, according to the manufacturers’ association. New boat sales rose 0.8% to 214,405 vessels, and a survey indicated attendance was up.
“It was our first glimmer of rebound,” said association spokeswoman Ellen Hopkins.
The Marine Trades Association of Maryland, which estimates the state’s boating industry is worth $2 billion and supports 35,000 jobs, hopes the tide will boost the local economy again.
But association officials worry that boaters will take their money to states with lower sales taxes. Maryland’s single excise tax is 5%, with no cap. Delaware has no tax and Virginia has a 2% tax capped at $2,000, although residents of the state must pay additional property taxes on boats.
The Maryland tax, due when a boat is purchased and titled, pays the Waterways Improvement Fund, established in 1966 to pay for boating equipment, dredging and upgrading marinas and boat launches. ‘water. But with boat sales plummeting, the fund plummeted from $30 million in 2005 to $14.2 million in the last fiscal year, even as its costs continued to rise, according to the Department of Natural Resources. the state.
Marine Trade Association officials favor increasing registration fees, which have remained unchanged for nearly three decades, and capping the excise tax on boats.
Everyone hopes the boating market will improve as house prices rebound, the cost of crude oil declines and the stock market rises. The Conference Board’s consumer confidence index for September rose to its highest level since February, at 70.3 from 61.3 in August.
“Traditionally, consumer confidence has been tied very closely to boat sales,” Hopkins said. “When you see consumer confidence increase, you also see new boat sales increase.”
The Annapolis Sailboat Show will showcase more than 200 ships, with 27 models making their debut, Jacobs said. The motorboat show will feature over 300 vessels, with new models from a number of manufacturers.
Beneteau America, a leader in the sailboat industry, turns heads with its line of trawlers, a recreational version of commercial fishing boats designed for stability and space. The $900,000 Swift Trawler 50 made its debut at Baltimore’s Trawler Fest this weekend and will make its second stop at the Annapolis Motorboat Show, home of the business office of Beneteau.
Germany’s Bavaria Yachts opened in the USA in Annapolis in 2011 and pulled the curtain on its line of Cruiser sailboats at last fall’s show. This year, he’ll be showcasing his new $311,000 Vision, a 46-footer designed to keep a couple “very comfortable, with occasional guests,” McCord said.
The old model to buy a 30ft beginner’s boat and then upgrade it through a series of “3ft-itis” has been turned upside down as the economy strengthens, he said.
“The younger crowd starts at 37 feet and up. They want to jump into the 40 foot club right away,” McCord said. “People are starting to buy boats instead of a cabana or a beach house so they can change neighborhoods, porch decor, whenever they want.”
But boat manufacturers and brokers are banking on pent-up demand to help rekindle the good times.
“People are hitting the pause button while shopping. We’re seeing more serious shoppers coming out,” Hopkins said. “Boating is a way of life. So if you have this virus, you’re going to find a way to make that lifestyle a reality.”