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What is the future of the recreational boating industry and what are experts saying it will look like in 10 years?
Hi! Thanks for your question about the future of recreational boating industry and its outlook in 10 years. The short answer is that the US recreational boating industry will rise by 6.1% per year to $13.1 billion in 2018. In the immediate future, the recreational boating industry is projected to take one-third of the total sales with more than $10 billion at 8% CAGR. The market will be driven by strong consumer spending, growing tourism market, access to credit facilities to boat dealers and change in boat technologies. A deep dive of my findings is below
RECREATIONAL BOATING MARKET GROWTH AND TREND
The demand of the recreational boat is on the rise due to the increasing recreational, tourism, and promotional tourist sports activities. According to a Freedonia report, US recreational boating industry is expected to grow by 6.1% annually to $13.1 billion in 2018. 75% of the global recreational boating market operate are in the US.
Another report reveals that recreational boating market will take one – third of the total sales of the boating industry in the future with more than $10 billion at an annual growth of 8%. Around 34% of the entire population of the U.S participate in recreational boating on a yearly basis. Data from Statista estimated that 87 million U.S adults participate in recreational boating as a leisure activity. The total value of recreational boats sold reached over $3.6 billion in 2016.
Strong consumer spending, growing tourism market, access to credit facilities to boat dealers and change in boat technologies is attracting more people for recreational boating. The rise in home values has left consumers more financially secure, and they can have access to home equity to finance boat purchases.
Trade up of used and ageing boats for new ones will also increase sales.
DEMOGRAPHICS
The average age of a U.S. boat owner was 55.5 years in 2015, and the strongest demand is still within the age range. Though the younger people are getting attracted to the industry, however, it has not been enough to upturn the older generation who are set to leave. According to the chairman of the Wisconsin Marine Association, John Kukuk, "What I am finding, from a personal standpoint, is that young people are not getting involved because they have too much on their plates".
The different generation of the millennial generation is a major disconnect. Attracting the younger generation entails accepting a more diverse customer.
Most Generation X and millennial don't have plenty of time or money to spare for an activity such as boating. They are more likely to rent a boat for few times a year instead of purchasing one. In another report, three-quarter of millennial established in their career may consider buying a new or used boat for recreational opportunities.
CHALLENGES AND OPPORTUNITIES
According to an article in the boating industry, Renewable fuel standards, access issues and government regulations are challenges faced for future growth. The ageing population of boaters is also a major problem. A study shows that 88% of respondent surveyed raised the concern while 63% were concerned about the lack of diversity.
The boating industry still lag behind in online technology. Some of the businesses have not upgraded their website for over 20 years. Most of the sites are not compatible with mobile which has effects on sales at the local level. Some of the company that adopted the latest technology has seen a rise in revenue.
The National Marine Manufacturers Association in partnership with The Outdoor Recreation Industry Roundtable is working to address the issue of visibility in the industry. An act was passed in 2016 which will quantify the economic contribution of recreation to the US economy, therefore gaining recognition in policy consideration in the future.
CONCLUSION
To wrap it up, US recreational boating industry will rise by 6.1% per year to $13.1 billion in 2018. In the immediate future, the recreational boating industry is projected to take one-third of the total sales with more than $10 billion at 8% CAGR. The market will be driven by strong consumer spending, growing tourism market, access to credit facilities to boat dealers and change in boat technologies.
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